2023 Severance Pay Cap is Determined
Law No. 7431 on Amendments to the Social Insurance and General Health Insurance Law, Certain Laws and Decree Law No. 375 (Law) was published in the Official Gazette dated January 13, 2023 and numbered 32072. With Article 7 of the Law, temporary Article 43 was added to the Decree Law No. 375 and the increase rate to be applied to the coefficients, contract wage increase rates, wage caps and the upper limit of the average wage total for the period 01.01.2023 - 30.06.2023 is decided to be 30%.
Following this decision, the Ministry of Treasury and Finance issued the Circular on Financial and Social Rights for January 2023 (Circular), which sets out the coefficients, rates of increase in contract wages, wage caps and upper limit of average wage total and other issues to be applied in accordance with the provisional article 43 added to the Decree Law No. 375. Pursuant to Article 2 of the Circular, the annual cap amount of severance pay to be paid to employees as of 01.01.2023, has been set at 19,982.83 Turkish Lira.
You may access the full text of the Law here and the full text of the Circular here.
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