LCS has provided a 2015 Taiwan Employment Law Update.
1. Five-Day Workweek to Kick Off Next Year
An amendment to the Labor Standards Act (the "LSA") will take effect on January 1, 2016, paving the way for a five-day workweek and for working hours per week to be reduced to 40 hours. The LSA currently sets a ceiling of regular working hours of 84 hours fortnightly.
2. Additional Pension Protections from Creditors
The newly added provisions of the pension systems under the LSA (also known as the old pension system) and the Labor Pension Act (also known as the new pension system) were enacted by the President on July 1, 2015, granting more protection to retired laborers against their creditors. To be applicable, a retired laborer shall open an exclusive account for the deposit of retirement pension with necessary documents at a financial institution. In doing so, the deposits in such specific account shall not be subject to offset, mortgage, security or compulsory execution.
3. 14 Categories of Employees, Including Bank Managers, No Longer Exempt from Working Hour Limits and Overtime Wages
Under Article 84-1 of the LSA, the so-called system of job responsibility provision, several categories of employees are not subject to the provisions of the LSA relating to working hours, holidays and overtime wages, thus employers can hire such employees on longer working hours without paying overtime wages. However, an administrative interpretation announced on December 18, 2014 and effective on January 1, 2015 has abolished this exception with respect to 14 categories of employees, including bank managers, senior field work securities specialists, management consultants in the consulting industry, case managers and professional planning and design personnel in the interior design industry, professional planning and design personnel in the construction industry, etc. Such employees must now receive the same standards for working hours, holidays and overtime wages as provided to other employees under the LSA.
4. Labor Inspection in Taipei City Reveals 97% of Bank Industry Failed to Pay Overtime Wage
The Department of Labor of Taipei City Government conducted a labor inspection on 32 banks in July 2015. The result revealed that around 97% of banks failed to pay overtime wage, 69% had their employees work overtime and 56% failed to convene labor-employer meetings in accordance with relevant laws. Such violations resulted in fines of around NT$9 million in total. The Department of Labor of Taipei City Government says it will request the Financial Supervision Commission (the "FSC") to increase the importance of "compliance of labor laws" to cooperatively improve the working conditions for laborers in bank industry. According to Ms. Chiu, the deputy of banking bureau of the FSC, banks should abide by the LSA; otherwise their compliance appraisal will be adversely affected and their working conditions will be reviewed by the banking bureau.