Supplementary Pension System (TES) is a system that aims to compensate for the loss of income in retirement. With the TES planned to be implemented, it is aimed to maintain the living standards of retirees during their working period. It is a study aimed at increasing household savings with additional income during the retirement period.
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In other words, TES is a second-stage retirement system supported by employees, employers and the state. In this system, cash contributions made to the employee’s individual account will be directed to private retirement investment funds, allowing them to accumulate savings. Employees in the retirement system will be able to manage their savings by choosing among funds.
When Will the Supplementary Retirement System Start?
The Supplementary Pension System was included in the three-year Medium Term Program covering the period 2024-2026. In the program, it was reported that a Supplementary Pension System would be established with the aim of providing additional income to retirees. It was stated that the Automatic Enrollment System (OKS) will turn into a second-stage retirement system with the contribution of employers. In this context, the Supplementary Retirement System is expected to be implemented in the last quarter of 2024. The start date of the new system has not been determined yet and an official date has not been announced.
How Will the Supplementary Retirement System Work?
Within the framework of the plan announced in the OVP, the severance pay system will be transformed into the Supplementary Retirement System. In the new system, employers will undertake to pay 8.33 percent of their salaries to employees as compensation every month. The paid amount will be accumulated in the employee’s individual account and can be used during retirement.
Is Participation in the Supplementary Pension System Mandatory?
If the system is launched, it is expected that all individuals working in the private sector will be gradually included in this system. In the first stage, participation in mixed TES will be provided, and then individuals will have the opportunity to switch to TES optionally. In this way, employees will have the opportunity to participate more effectively in retirement plans according to their own preferences.
Is it Possible to Leave for the Supplementary Retirement System?
There will be no withdrawal or separation of participants in the Supplementary Retirement System. Exit will be limited to the employee’s death or disability when the retirement period is completed. Individuals who participate in the system but have not yet reached the age of 60 will have the right to receive a certain portion of their savings in their individual retirement accounts only once, if they apply for reasons such as marriage, unemployment, serious illness.
When the system envisaged by the Medium Term Program is implemented, severance pay will no longer be received at the time of termination. The amount accumulated for severance pay can be used during retirement. Employees who leave their jobs until the age of 60 will be able to receive half of their severance pay as a one-time payment. The remaining portion can be used when the age of 60 is reached and retirement conditions are completed.
What Will Happen to the Employee’s Savings in TES If He Changes Jobs?
If the employee is dismissed or resigns except for a justified reason for termination, the amount accumulated in the individual fund account will be preserved as it was during the last period he worked for the company.
If the employee’s working period is more than one year and the employment or service contract is terminated due to non-compliance with the rules of ethics and good faith, 50 percent of the employer contribution and state contribution in the last company will be preserved in the individual fund account, while the other 50 percent will be transferred to the TES insurance account. The transferred amount will be blocked in the employee’s account until the legal process is finalized.
If the employee’s employment or service contract is terminated in less than one year or if he or she resigns and leaves the job, the employer contribution and state contribution will be transferred to the TES insurance account and this amount will be blocked in the employee’s account until the legal process is finalized.
Will Retirees Receive Lump Sum Money?
When a person retires, he will be able to claim up to 25 percent of the amount accumulated in his account as a lump sum. The remaining amount will be paid monthly. Even if the employee has worked for only one day, his rights in the individual fund account will be preserved. If he is dismissed by the employer, he will retain his status in the TES contribution account, which is valid for only one day worked.
