Minister unveils flexible employment package

Hacer Boyacıoğlu - ANKARA

Fixed-term contracts that will be brought into law with the new employment bill will be limited to two years, Family, Labor and Social Services Minister Zehra Zümrüt Selçuk has said.

“We will continue taking steps to ensure sustainability and an increase in employment. That’s exactly what we aim at with the new employment package,” she told reporters at her office in Ankara on Oct. 15.

Flexibility rate in Turkey’s employment schemes is very low compared to European countries, she also said.

“We are aiming at easing conditions for those aged below 25 and over 50 to participate in the labor force with part-time and flexible working schemes. Within this framework, fixed-term contracts with a period of up to two years could be signed. Employers will not be able to renew a fixed-term contract with a worker at the end of two years,” said Selçuk.

Turkey is eyeing flexible employment schemes as a panacea to its high unemployment rate and in a bid to cushion the effects of the coronavirus pandemic on the economy, according to the minister’s remarks.

The government is planning to give extra support to unemployed people in finding a new job as soon as possible after they are made redundant.

“With the fast return-to-work support, the state will cover the pension premiums of those who are employed in three months after they start to be paid unemployment allowance,” she said, revealing an incentive for employers to hire people newly left jobless.

Human resources experts warn that most of the unemployment allowance beneficiaries stop seeking a job and enter a period called “chronical unemployment” six months after they lose their jobs.

Labor force reaches 31.5 mln

Turkey’s unemployment rate was 13.4 percent, with a 0.5 percentage point drop in July, according to the Turkish Statistical Institute (TÜİK).

The number of unemployed aged 15 and over decreased 369,000 to 4.22 million as of July compared to July 2019.

The youth unemployment rate among those aged 15-24 was recorded as 25.9 percent.

On the other hand, the employment rate stood at 43.5 percent with a 2.9 percentage-point drop.

Turkey’s labor force fell 1.62 million year-on-year to 31.5 million people as of July.

The country’s labor force participation rate was 50.3 percent in the same month - 69.2 percent for men and 31.7 percent for women.

The rate of unregistered employment - people working without social security related to their principal occupation - was 32.7 percent in July, down 3.3 percentage points on a yearly basis.

Turkey’s new economic program, announced at the end of September, targets an unemployment rate of 13.8 percent this year and 12.9 percent next year.

The number of workers benefiting from the short-term working allowance decreased to 1 million at the end of September from its peak of 3.2 million in May, according to the Unemployment Insurance Bulletin.

The total amount of monthly short-term allowances paid from the fund fell to 1.57 billion Turkish Liras ($198.1 million) in September.

The government extended the wage support system, which was introduced in late-March, until the end of October.

Under the short-term employment allowance scheme, the unemployment insurance fund pays 60 percent of the staff salaries of the employees when a business cuts work hours. Any firm forced out of business due to a force majeure, such as the pandemic, can approach the government as part of the short-time working scheme introduced in 2008. A new presidential decree is needed at the end of this month to continue recognizing the coronavirus pandemic as a force majeure.