What is the minimum wage, how and by whom is it determined?

While the minimum wage of the new year was determined at the end of each year, the minimum wage was determined for the second time in 2022 in a way that is not very often seen in Turkey due to high inflation, and in July the new minimum wage was announced as 5500 TL. So, what is the minimum wage, which affects all of us in direct and indirect ways as citizens of the country, by whom and how is it determined?

The minimum wage is the lowest wage that is determined to be paid to a worker for one working day. This wage should be enough for the worker and his family to maintain their economic and social lives in a good way. It is one of the universally accepted labor rights and basic social human rights. The minimum wage, examples of which were seen in practice at the end of the nineteenth century, was guaranteed by international conventions in the twentieth century. The minimum wage in the world was first introduced in New Zealand and was determined based on the price of 45 products. Turkey, on the other hand, has adopted the minimum wage application with the Labor Law No. 3008 dated 1936.

Different methods are used in countries when determining the minimum wage. In most countries of the world, the minimum wage is legal and mandatory, but in some countries (especially the Scandinavian countries), the minimum wage is determined by collective labor agreements at the national or sectoral level, not by a mandatory system. According to International Labor Organization (ILO) estimates, the minimum wage is determined by laws and collective agreements in 90% of countries, while there is no minimum wage application in 10% of countries. If we summarize, there are basically three methods for determining the minimum wage. The minimum wage can be set directly by the government, determined through negotiation between the government and social parties(labor and employer unions), or determined through national or sectoral collective bargaining.

The minimum wage in Turkey is determined by negotiation between the government and social partners. A tripartite commission, called the Minimum Wage Determination Commission, meets every year and negotiates to determine the minimum wage. The commission includes representatives of five governments, five employers and five workers. The representatives of workers and employers are determined by the top worker and employer organizations with the highest number of members (worker representatives are Türk-İş and employer representatives are TİSK). From past to present, since the adventure of minimum wage in Turkey began, many criteria have been taken as basis while determining wages; regional wage policies, sectoral minimum wage policies, and minimum wage policies that pay different wages to those under the age of 16 and above. As of 2014, a uniform minimum wage has been determined at the national level and for all sectors, regardless of age, and it continues today.