Ankara, Nov 12 () - The annual cost of a 30 percent increase in the minimum wage, an election promise by the Justice and Development Party (AKP), will cost the private sector 16 billion Turkish Liras, according to the head of the Istanbul Chamber of Commerce (İTO).
The commission to decide on the minimum wage will convene on Dec. 1, said Labor Minister Faruk Çelik on Nov. 11, adding the new government to be founded after the Nov. 1 election that granted single-party rule to the AKP will submit its suggestion of 1,300 liras to the commission.
“The minimum wage will be 1,300 liras as of Jan. 1, 2016,” the minister said.
The business world was largely silent about all parties’ minimum wage pledges before the elections, as most parties offered even higher figures. However, when the promise took a more concrete shape, business organizations started raising concerns.
İTO head İbrahim Çağlar said the rise would bring in 16 billion liras of additional costs for private companies.
Çağlar demanded a discount in the social security fees of then firms in exchange.
The İTO suggestion refers to a 7-billion-lira annual cost for the state.
Ankara Chamber of Industry (ASO) chairman Nurettin Özdebir said the additional burden should be compensated for one or one-and-a-half years.
There are around 12 million employees in Turkey and some 5 million of them are paid the minimum wage, at least on paper. However, some companies illegally tend to show wages lower to avoid higher fees.