Council of State 10th Chamber’s Annulment Decision Regarding SSI Meal Exemption

The 10th Chamber of the Council of State annulled the provisions of the regulation and circular governing the exemption limit for cash meal payments made by employers to third parties for insured employees, as well as meal payments made through meal coupons, meal cards, meal vouchers, etc., provided against invoices.

The exemption limit applied to meal allowances, which were partially considered as earnings subject to premiums for insured employees within the scope of Article 4, paragraph 1(a) of the Law, was annulled by the 10th Chamber of the Council of State.

Article 97, paragraph 7(a) of the Social Insurance Transactions Regulation, which regulates the earnings subject to premiums for insured employees within the scope of Article 4, paragraph 1(a) of the Law, was amended by the regulation published in the Official Gazette dated November 1, 2022 and numbered 32010. The new regulation stated that "provided that meals are not provided at the workplace or its premises, any payments made under the name of meal allowances to the insured employees or to third parties for the insured employees will not be considered in the calculation of earnings subject to premiums, based on the amount found by multiplying the rate determined by the Institution’s Board of Directors for the daily minimum wage by the number of days worked."

Following the regulation, Circular No. 2022/22 on Meal Allowance (In Turkish) was published by the Institution on December 2, 2022 to determine the procedures and principles related to the application. The circular provided the following regulations on the subject:

2.1.2 - Application of cash meal payments made to third parties for insured employees

In cases where employers make cash payments to third parties under the name of meal allowances for insured employees at locations outside the workplace or its premises, the amount found by multiplying 23.65% of the daily gross minimum wage by the number of days worked will not be included in the earnings subject to premiums.

2.1.4 - Application regarding meal payments made through meal coupons, meal cards, meal vouchers, etc., to third parties for insured employees

If meal allowances are not paid in cash within the month, meals can be provided through meal coupons, meal cards, meal vouchers, etc., from another firm or individual producing meals outside the workplace where the employees work. In this context, if meal payments are made to third parties for insured employees through meal coupons, meal cards, meal vouchers, etc., against invoices, the amount found by multiplying 23.65% of the daily gross minimum wage by the number of days worked will not be included in the earnings subject to premiums.

In its decision dated May 8, 2024 and numbered 2023/170 E. and 2024/185, the 10th Chamber of the Council of State annulled the provisions of the aforementioned regulation and circular.

In summary, the reasoning of the decision highlighted that meal allowances should be evaluated based on whether they are in-kind (providing meals) or cash (monetary payments). It was stated that payments made by the employer to third parties in cash or through instruments such as meal cards or vouchers should be considered in-kind assistance. It was emphasized that in cases where payments are made with meal cards, vouchers, or similar tools for the purpose of meal expenses, and it is not possible for the employee to use the payment tool for other purposes as cash or cash equivalents, it would constitute in-kind assistance, and in such cases, it cannot be considered as a cash allowance. However, if the meal allowance is made in cash or in a way that can be used for other purposes, it will be considered a cash allowance, and if the determined limits are exceeded (23.65% of the daily gross minimum wage as per the Institution’s Board of Directors’ decision dated November 17, 2022 and numbered 2022/323), it will be subject to premium deductions.

Based on these grounds, the Council of State ruled that the regulations mentioned above were not in compliance with the law and decided to annul them.

To address the uncertainties in the working life regarding this issue and to provide guidance on the implementation, it is expected that a general letter or announcement will be issued by the Social Security Institution.

Should you have any queries or need further details, please contact your customer representative.