Last year, the Tsai administration passed an amendment to the Taiwan Labor Standards Act that implemented a 5 day work day for everyone, along with other things such as more annual leave, 7 less national holidays, and restrictions to overtime.
Here is a good news article that gives background for those who are unfamiliar with the new law: http://englishnews.ftv.com.tw/read.aspx?sno=FE070FFEA86AC2869E1665CEDFD0E27A
Q and A:
Q: Is this important?
A: Yeah, it is. It’s a big deal for everyone working in Taiwan. The Labor Standards Act hasn’t been amended in over 30 years, and it is long overdue.
Q: Is it a good thing?
A: Yes. It’s not perfect overall but it is an improvement to society in general
Q: How will this affect Taiwan’s economy?
A: In my opinion, productivity and efficiency should increase in the workplace, and some jobs might go overseas. Labor costs may increase.
Q: What is this law changing?
A: 5 day work day for everyone (one set rest day and one flexible rest day), along with other things such as more annual leave, 7 less national holidays, more rights given to workers, and restrictions to overtime (overtime on rest days is multiplied, and no more than 46 hours of overtime can be clocked per week).
Q: How do foreigners feel about it?
A: We think it’s great. Please read our full opinion below.
Not a day goes by that I don’t hear about this law is in the news. Some people like it, some don’t. However, not a lot of people seem to really know what it is. I was one of those people, until I heard about a conference that would explain this law to a crowd of HR representatives. I got permission from my company to go. This conference was comprised of speakers featuring the former Taiwan labor minister and some professors from local Taiwan universities who were experts on this topic. Below is more or less a summary of what I learned there.
What this law is:
The fundamental part of this law is a 5 day work week; there are two days break every seven days. These two days are flexible. One of these days has to be the same day every week, like every Sunday (例假). The other day (休假) is more flexible, and can be any other day within the seven days. Also, this other day (休假) can be carried over to other weeks, up to eight weeks. This means that one week there might be 6 work days but the next week will only have 4 work days, etc. I don’t think I need to get into more detail here; suffice it to say that this day is flexible.
Thanks to this new law, salary for overtime on rest days is multiplied, and no more than 46 hours of overtime can be clocked per week. Overtime that goes over 2 hours is also multiplied.
More yearly vacation is given to employees that stay in the company for at least 6 months. Seven national holidays are gone. Minimum wage has been raised. There are many other details, but I will stop for now because I know you don’t care unless you work in HR at a Taiwanese corporation.
What this law means for companies:
The new Labor Standards Act is the lowest standard for companies to meet. This is not supposed to be the top bar, but unfortunately many Taiwanese companies see it as such. You might say it is unfair to set the same labor standard for every industry, as every industry is different. However, it would actually be more unfair to change this standard for every industry, as this is a pretty low standard as it is.
Companies should be setting a higher standard. Every industry is different, so they should figure out how to satisfy and attract employees themselves according to their own circumstances, and not rely on the government to set a standard and then give support when workers revolt. As one of the speakers put it (and I’m completely paraphrasing here):
Following this minimum standard is like driving 60km on the highway from Taipei to Kaohsiung; everyone is going to be honking at you and passing you. It’s not where companies are should be. Sadly, most companies in Taiwan only follow the lowest labor standards. Once, a CEO of a company with 2000 employees boasted (to one of the professors) at how he followed the Labor Standards exactly. Even so, he was still not better than any other owner of a street noodle stand that gives the same benefits.
Companies, especially large companies, need to be setting a higher bar, especially if they want to stop professionals from leaving Taiwan for better salaries and benefits overseas. As the newer generation demands more and more benefits (as seen from recent studies), companies that fall behind with basic benefits will have a hard time finding talent.
What this means for employees:
Let me preface by saying that Taiwan law hasn't changed its labor standards in over 30 years; these were way outdated and in desperate need of revision.
One of the best parts of this law is that it increases annual leave for everyone. One of the biggest changes in this area was the addition of three days for those that have worked in a company for over 6 months. This affects me directly, so I was pretty happy about it. More annual vacation is good, especially for new workers who are the most stressed and need it most. According to one of the speakers in the seminar I attended, workers that do not take vacation are ineffective (again paraphrasing from the Chinese):
Think back to when you went to school. We all looked up to those kids with good grades that still had time to go out and have fun. We looked up also to the kids that had fun but didn’t get good grades, and the kids that got good grades but didn’t have much fun. The group that no one envies is those that get poor grades and have no fun; this is exactly what people that never take vacation are.
Everyone will get tired throughout the year. We are not robots. Taking rest is not only good for employees; it is good for the companies. Taking a break makes employees happier, more motivated, and gives them more energy to complete their work. Therefore, taking breaks is profitable for the company. Under this logic annual leave is compensated according to Taiwanese law.
Another great thing about this amendment is that it gives employees more control over their annual leave. In the old system, employees had to come to an agreement with their employer before they could take annual leave, which prevented many people from using it up. However, now the decision of when to take yearly leave is given totally to the workers. Now, employees will have more flexibility for their vacation time and be able to receive adequate rest.
Something that might be bad for employees is that Taiwan basically gives them no power if there is a dispute with an employer. Worker’s unions can only be organized in companies that have over 30 employees. Many companies cut the number of employees for this reason. In fact, 97% of employees in Taiwan have no access to a worker’s union. Also, unlike other countries, Taiwan has never really gone through a worker’s revolution. Taiwanese corporations have pretty much always had power to push around employees and bend their will. Taiwanese people are usually too embarrassed to say no to overwork (this has a lot to do with Taiwanese culture). In fact, many Taiwanese companies give monetary reward for not taking any leave at all, which is unproductive for everyone. Also, many workers are afraid to leave the office if their boss has not left yet, which is ridiculous to me but it is part of their culture.
Alternatively, one might argue that this new Labor Standards Act might actually be harmful to worker’s unions, because if a company follows this basic standard, then Taiwanese companies will have very little leverage in improving the working environment.
What this means for foreign workers:
When I worked in a cram school, my boss broke every rule in the book. She payed under the table, worked me under the table, made everyone work overtime with no compensation at all, and didn’t give me health or labor insurance for my first 6 months. My fellow foreign coworker had been working in the same system for over 2 years. Although he complained that it was like hell for him, he didn’t care because he got his paycheck every month and at night he could go out to the clubs, get hammered, and play in his indie band on the side. To all of you foreigners working with the devil as your Taiwanese boss, stand up for yourselves!
As for me, I didn’t even know what the Taiwanese labor standards were at the time. For you, there is a clause called the whistleblower policy. This protects you against any retaliation that the boss might try on you if you turn them in. You are protected from them taking away your salary or punishing you in any way according to the law. If you or your coworkers are working overtime, make sure you are getting overtime pay. If the company is searched by the authorities and they do not give them your clock-in sheet, they will automatically be fined 90000.
My advice to foreigners: if you see any problems within your company, particularly if they are not following these standards, and your boss refuses to solve them, then call the labor office. Only through enforcement of this act can we improve the working lives of foreigners and Taiwanese alike.
P.S. If you have any questions about this, feel free to send us a message via Twitter.
We are US Expats that have extensive experience living and working in Taiwan. In our day, we had to learn many things about Taiwan the hard way. But we have come to learn that Taiwan is one of the best places in the world for Foreigners to live. Our blog does not represent the opinions of every foreigner in Taiwan. We are just trying to help others learn more about this beautiful country.