Payroll

There are 2 types of employment contract recognized by LSA: fixed-term and non-fixed-term employment. Individual employment contracts should include the below information:

• Standard days of work, working hours and rest time
• Salary and benefits
• Calculation of pay, the day and method of payment
• Place of work
• Holidays
• Overtime pay
• Information on pension
• Information on training
• Information on awards and discipline procedures
• Health and safety regulations
• Termination of employment, severance and retirement
• Compensation for occupational hazards and accidents

Salary

Salaries should be paid into employees’ bank accounts. The salary is paid on the last day of the pay period unless otherwise agreed. In Taiwan practice, the salary can be made in cash, check, or electronic fund transfer. The employer must deliver payslips to employees and the payslips can be free-form with detailed information.

Sick Pay

Employees are entitled to ordinary sick leave of 30 days per year, which is paid at half-pay. In addition, if an employee is hospitalized, he/she is entitled to an unpaid leave of up to 1 year.

Working Condition

Employees are limited to work 40 hours per week, with no more than 8 hours of work per day (not including overtime). The total number of working hours (not including overtime) can never exceed 48 hours per week.

Employees are entitled to at least 2 days off per week, 1 mandatory day off, and 1 flexible rest day. An employee cannot agree to work on the mandatory day off, but he can agree to work on the flexible rest day with higher overtime pay. If employers violate these rules, they will be subject to penalties.

Overtime

Employees are permitted to work 54 hours of overtime per month, but no more than 138 hours in a three-month period. Employers may also provide extra leave as compensation for overtime work. The employer should pay 134% of the normal salary for the first 2 hours of overtime and 167% of the normal salary for the hours after the first 2 hours of overtime in a single day.

Annual Leave

Employees are entitled to annual leave depending on the period they served in the company:

• 3 days for 6 months to 1 year
• 7 days for 1 to 2 years
• 10 days for 2 to 3 years
• 14 days for 3 to 5 years

Employment Termination

As Taiwan is not an at-will termination jurisdiction, any termination must be carried out according to one of the allowed circumstances for unilateral termination under LSA. An employer can terminate an employment contract with notice (or with pay in lieu of notice) and with severance pay only in one of the following circumstances:

• Stoppage of business or a transfer of ownership
• Business losses or curtailment of business operations
• Suspension of operations for more than 1 month due to a force majeure event
• Alteration of business nature, forcing a reduction in the number of employees, and those employees cannot be reassigned to other suitable positions
• The employee is incapable of performing the tasks assigned
  
  

An employer can terminate the employment contract without a notice or severance pay only in one of the following circumstances:

• Misrepresentation of the facts by the employee at the time the labor contract was signed leads, or may lead, to the employer suffering a damage
• Acts of violence by the employee against the employer, the employer’s family or representative, or other employees
  Serious breaches by the employee of the employment contract or work rules
• The employee has been sentenced to temporary imprisonment in a final judgment, which cannot be suspended or commuted to a fine
• Purposeful damage or abuse to the employer’s property by the employee
• Intentional disclosure by the employee of the employer’s technological or business secrets
• The employee’s absence from work for three consecutive days, or for six days in a month, without justifiable reasons