Worker Rights

Severance Package

Employees are generally entitled to severance pay if their employer terminates their contract under specific circumstances, such as redundancy or employer-initiated dismissal. The severance pay is calculated based on the employee's length of service and average salary.

Key Points

• Severance Pay Calculation

  • Employees are entitled to one month's salary for every full year of employment.
  • For periods of service that are not a full year, the severance pay is calculated on a pro-rata basis (e.g., if an employee worked for six months, they would receive half a month's salary).

• Conditions for Eligibility

  • Severance pay is typically applicable if the employer initiates the termination, such as due to economic reasons, redundancy, or business restructuring.
  • It is not generally applicable if the employee resigns voluntarily or is dismissed for serious misconduct.

• Payment Timing

  • Severance pay should be paid immediately after the termination of employment, unless otherwise agreed upon in the contract or collective labor agreement.

• Other Protections

  • In addition to severance pay, employees may also be entitled to other forms of compensation, such as unused annual leave pay, depending on the situation and the employment contract.

Employees facing termination should review their employment contract, consult with labor authorities, or seek legal advice to ensure they receive their rightful severance pay and other entitlements.

Unemployment Benefits

In Taiwan, workers who face unemployment may be eligible for unemployment benefits and relief provided by the government under specific conditions. These benefits are designed to assist individuals who lose their jobs and meet certain criteria. Here's an overview of the unemployment benefits and relief available:

Unemployment Benefits

Unemployment benefits in Taiwan are provided through the Labor Insurance Program (勞工保險), which is managed by the Labor Insurance Bureau.

• Eligibility

  • To qualify, employees must have paid into the Labor Insurance for at least one year before becoming unemployed.
  • The employee must be involuntarily unemployed (e.g., due to layoffs or business closure). Those who voluntarily resign are generally not eligible.
  • The individual must be actively seeking employment and register with the Public Employment Service (勞動部就業服務中心).

• Benefit Amount

  • The unemployment benefit is typically 60% of the average monthly salary during the most recent six months of employment.
  • The benefit is capped, with the maximum monthly amount varying depending on the insured salary.

• Duration

  • Unemployment benefits are provided for up to six months.
  • In some cases, benefits can be extended for an additional six months if the individual is still actively seeking employment and meets the eligibility criteria.

• Application Process

  • To apply for unemployment benefits, workers must visit the local labor insurance office or the Public Employment Service and submit the required documentation, such as proof of employment, a termination notice, and evidence of job search efforts.

Employment Relief Programs

In addition to unemployment benefits, Taiwan offers employment relief programs to support workers during economic downturns or in the event of large-scale layoffs.

Job Retention Programs

• The government may provide financial assistance to employers to retain workers, or to hire displaced workers during periods of economic hardship.
• Programs may include training subsidies or temporary subsidies for employers who keep workers employed during periods of economic instability.

Career Retraining

• Unemployed workers can also access various retraining programs to improve their skills and increase employability.
• The government offers free or subsidized vocational training courses and job placement assistance through the Public Employment Service.

Other Relief Measures

During times of economic crisis or natural disasters, the government may introduce additional relief measures for unemployed or economically affected individuals. These can include:

• Subsidies for Basic Living:

  In cases of extreme financial hardship, individuals may be eligible for basic living subsidies to help cover essential needs while they seek new employment.

• Special Relief Funds:

  The government may provide one-time relief payments or funds to support unemployed individuals or those affected by specific economic events (such as the COVID-19 pandemic).

Key Points to Remember

• Unemployment benefits are available for employees who have been involuntarily laid off and have paid into Labor Insurance for at least a year.
• Benefits are generally capped at 60% of the average salary and can be received for up to six months.
• Workers must actively seek employment and may benefit from retraining programs and job placement assistance.
• Relief programs can offer additional support during economic downturns or crises.

It's important for unemployed workers in Taiwan to stay informed about the eligibility requirements, application processes, and any special relief programs that may be available at the time of their unemployment.

Handling Demotions

In Taiwan, demotions are not typically explicit; rather, they usually occur through contract renegotiation as a way to keep workers who would otherwise be laid off. Demotions must be justified, typically due to performance or organizational changes. Employers should communicate the reasons clearly and seek agreement.

If a demotion results in a significant reduction in salary or responsibilities, it may be seen as constructive dismissal. In such cases, maintaining open communication, seeking clarification, negotiating a fair transition, or even seeking legal advice is crucial if the changes are significant. Keep in mind that Taiwan has strong labor rights that guarantee a full-time employee rights to fair compensation in the event of a layoff (see below).

• Labor Standards Act (Taiwan)

  • Website:Ministry of Labor - Taiwan
  • For legal reference on labor standards, including demotions and employee rights.

• Legal Advisors or Lawyers

  • Employees can consult legal counsel specializing in labor law. Contact the Taiwan Bar Association for recommendations.
  • Website:Taiwan Bar Association
  • Phone:+886-2-2341-5021

• Labor Union

  • If you are a union member, contact your union representative for assistance and negotiation support. Key unions include the Taiwan Confederation of Trade Unions (TCTU).
  • Website:TCTU
  • Phone:+886-2-2392-0387

• Mediation Services

  • The Mediation Division of the Ministry of Labor offers free services to resolve disputes.
  • Website:Labor Mediation Services
  • Phone:+886-2-8995-6000

• Employee Assistance Programs (EAP)

  • If your company offers an EAP, reach out to HR for access. These programs provide counseling and support for workplace challenges.

• HR Department

  • Discuss the situation with your HR department to understand your options and negotiate the terms of the demotion.

• Online Legal Resources

  • Taiwan Labor Foundation offers comprehensive information on labor laws.
  • Website:Taiwan Labor Foundation
  • Phone:+886-2-2322-8022