Newsletter
FOLLOW-UP MEASURES FOR IMPLEMENTATION OF NEW WORKING HOURS
The Council of Labor Affairs (CLA) plans to adopt a number of measures to deal with impacts of the new working hours system on the local labor market. The following is a brief introduc-tion.
CLA Considers Switching to Hourly Wage Standards
The current system of calculating salaries on a monthly basis may be due for a major reform. Following the introduction of the new working hours, to avoid problems between labor and management over wage determination arising out of the reduction in working hours, the CLA is considering adopting a system whereby basic wage levels would be defined in terms of hourly rates. It also wishes to use this as a means to promote the concept of "no work, no pay."
The CLA states that at present, basic wages may be defined in terms of monthly, daily or hourly pay. When the working week was 48 hours, it made little difference which unit was used. But when the working week is reduced to 42 hours, should one day's work be defined as eight hours, or seven? And should the six-hour reduction be treated as "paid leave," or "unpaid leave?" Such issues remain to be agreed between labor and management. To give both sides greater flexi-bility in their negotiations, and to reduce poten-tial disputes over wage determination, the CLA will define basic wages in terms of hourly rates.
Calculation of Overtime
To address the controversy over overtime pay-ments which has arisen since the introduction of the new working hours regime, the legal de-partment of the CLA recently approved a draft amendment to Article 20-1 of the Enforcement Rules of the Labor Standards Law (LSL). In future, all hours worked in excess of 8 hours in one day or 84 hours in two weeks will be classed as extended working hours, for which overtime must be paid. However, for business entities in sectors designated by the CLA under Article 30-1 of the LSL that have adopted other working hours by agreement with their workforce, and for those that have reached such agreements under Article 30 Paragraph 2 of the LSL, extended working hours means hours beyond those so agreed.
The CLA expects to officially announce the amendment around the middle of 2001, after completing administrative procedures.
CLA to Check on Compliance
To ensure that the new working hours regime is fully implemented, the Labor Inspection De-partment of the CLA will begin a phased series of inspections from March at the earliest. This year, targeted inspections of working conditions will cover conditions at large enterprises, condi-tions in industries not previously covered by la-bor inspections, and the status of employers' payments into worker retirement funds. Working hours will be a major focus of the first two of the above operations. The inspections will be phased according to size of enterprise: the first phase will target entities employing at least 700 workers, the second phase those employing at least 500 workers, the third phase those em-ploying at least 300, and the fourth those em-ploying at least 100. Additionally, where work-ers make complaints to local labor inspection departments, the CLA will make inspections on a priority basis.
Work Rules Must Be Submitted for Review within 30 Days after LSL Amendment
The Enforcement Rules of the LSL require the work rules of a business entity to be submitted to the competent authority for review within 30 days following any legislative amendment which requires them to be changed. Failure to do so attracts a fine of NT$2,000 to NT$20,000. The Taipei City Government Bureau of Labor Affairs calls on the city employers to amend their work rules in light of the new working hours regime and submit them for review as soon as possible in order to avoid penalties.
CLA to Amend Provisions Affecting Part-Time Work
The CLA intends to promote part-time working as a means to reducing unemployment. With this in mind, in the near future it plans to relax vari-ous restrictions which discourage part-time work. Special leave, severance pay and retirement pay will be calculable on the basis of a part-time worker's actual weekly or monthly working hours, pro rata to the statutory working hours.
In view of part-time workers' relatively low total income, the CLA will amend the Labor Insur-ance Act to reduce the minimum premium level for assessing labor insurance contributions from the current NT$12,000 to NT$8,000. In other words, part-time workers earning more than NT$8,000 per month will pay contributions ac-cording to their individual wage band; those earning less than NT$8,000 will all pay contri-butions at the level for NT$8,00. Further, part-time workers with two or more jobs will have to pay a full labor insurance contribution only on the job with the highest income. For their other jobs, they need only pay the occupational accident insurance portion. For part-timers with very low total working hours, the CLA plans to allow employers to only pay industrial accident insurance occupational.