In the ever-evolving landscape of employment law, Taiwan has emerged as a focal point for significant legal reforms aimed at enhancing workplace equity and safety. This episode of the Employment Matters podcast offers a deep dive into these pivotal changes, setting the stage for what businesses can anticipate in the coming year.
Today, we explore the strides made in Taiwan's employment law throughout 2023, underscored by amendments that have fortified protections against workplace injustices, notably sexual harassment. Elizabeth Pai, a distinguished legal authority from Lee, Tsai & Partners, joins us to unfold the complexities of these legal transformations and their implications for employers in Taiwan.
Key Legal Changes in 2023 Impacting Employers in Taiwan
Amendments to the Act of Gender Equity Employment
The year 2023 marked a watershed moment for employment law in Taiwan, with the Act of Gender Equity Employment undergoing significant amendments. These changes represent a concerted effort to combat sexual harassment in the workplace, introducing more stringent measures to protect employees and hold perpetrators accountable. Below, we highlight the major amendments and their impact on the employment landscape:
Clarification of Abuse of Power
In a significant move to curb power dynamics exploitation, the Act now precisely characterizes abuse of power sexual harassment. This encompasses instances where an individual leverages their authority to engage in unwelcome sexual advances towards subordinates or those reliant on their supervision in professional contexts.
The legislation has introduced steep penalties, potentially amounting to up to five times the damages claimed by the victim. This penalty escalates further if the harasser occupies the top echelon of the company, such as a CEO, underlining the law's stern stance against such abuses at the highest corporate levels.
Strengthened Internal and External Complaint Channels
A pivotal amendment focuses on bolstering the mechanisms for lodging complaints of sexual harassment. Employers are now mandated to develop more comprehensive internal complaint systems.
Simultaneously, an external channel has been established to cater to scenarios where the harasser is a high-ranking official, the employer, or in cases where the employer's response to a complaint is deemed inadequate. This dual-channel approach ensures victims have multiple avenues for seeking redress, enhancing the accountability framework within organizations.
Lowered Threshold for Establishing Complaint Channels
In an effort to extend protections to a broader segment of the workforce, the threshold for establishing sexual harassment complaint channels has been significantly lowered. Employers with ten or more employees are now required to set up these channels, a considerable expansion from the previous stipulation that applied to employers with at least 30 employees.
This amendment reflects a commitment to creating safer and more equitable workplaces across the board, ensuring that more employees have access to mechanisms for addressing sexual harassment.
Guiding Principles of Wage Payment: A Step Towards Fair Labor Practices
In 2023, the Ministry of Labor in Taiwan took a decisive step to address a long-standing issue that has implications for workers across the nation—delays in wage payments. By introducing guiding principles to regulate wage payment dates and frequencies, the Ministry aims to ensure that workers receive their earnings in a timely manner.
This move is not just about enforcing compliance; it's about fostering a culture of respect and fairness in the employment sector. The directive sets a clear target: payday must fall within 10 days after the wage calculation period ends, a standard designed to eliminate undue delays that can strain employees financially.
Anticipated Changes and Predictions for 2024: Navigating New Terrain
As we look towards 2024, the legal landscape in Taiwan is poised for further evolution, especially concerning Employer of Record (EOR) and Professional Employer Organization (PEO) arrangements. These models have become increasingly popular as multinational entities seek to tap into Taiwan's rich talent pool without the complexities of establishing a local corporate entity. However, this trend brings to the fore several legal considerations that employers must navigate with care:
Rights of Individuals in Labor Dispatch Arrangements
The rise of EOR and PEO services highlights the need for clearer regulations on the rights of dispatched individuals. Specifically, there's a growing demand for legal clarity regarding these individuals' rights to request direct employment agreements with the companies they serve. This issue touches on the core of labor rights, ensuring that dispatched workers are not left in a precarious position, devoid of the protections and benefits afforded to direct hires.
Joint Responsibility for Occupational Safety
Another critical area of concern is the joint responsibility borne by companies and labor dispatch entities for the safety of dispatched individuals. This shared duty underscores the importance of adherence to occupational safety standards, reflecting a commitment to the well-being of all workers, regardless of their employment status. As these arrangements become more common, ensuring a safe working environment for dispatched employees is paramount.
Legal Liabilities for Foreign Companies
Foreign companies leveraging dispatched labor in Taiwan face a unique set of challenges, particularly if they do so without establishing a local presence. The legal liabilities associated with such practices are significant, emphasizing the need for proper business registration and compliance with Taiwanese laws. This requirement serves as a reminder of the legal intricacies of operating in a foreign market and the imperative to engage with local legal frameworks respectfully and diligently.
Preparing for Compliance and Anticipated Regulations
As Taiwan's employment law landscape undergoes significant transformations, employers find themselves at a crossroads, needing to adapt swiftly to ensure compliance and safeguard their workforce. The amendments and guidelines introduced in 2023 are not merely statutory changes but signals towards a more inclusive, safe, and fair working environment. Here's how businesses can prepare for these evolutions and what they entail for future operations.
Enhancing Sexual Harassment Policies
The amendments to the Act of Gender Equity Employment highlight a societal and legislative push towards eradicating workplace harassment. For employers, this means revisiting and reinforcing sexual harassment policies is not just about legal compliance but fostering a culture of respect and safety. Organizations must ensure that their internal complaint mechanisms are robust, accessible, and ensure confidentiality and protection for complainants. Furthermore, establishing clear, actionable steps for investigating and addressing complaints can enhance trust and accountability within the workplace.
Reviewing Wage Payment Practices
The Ministry of Labor's guiding principles on wage payments underscore the importance of fair labor practices. Employers should conduct thorough reviews of their wage payment practices, ensuring they align with the new regulations.
This includes setting payday within the specified timeframe post the wage calculation period and ensuring that wage disbursements are timely and consistent. By aligning internal wage payment regulations with these guidelines, employers can avoid potential penalties and foster a more trusting relationship with their employees.
Considering Direct Employment Over Dispatch Services
The complexities surrounding Employer of Record (EOR) and Professional Employer Organization (PEO) arrangements necessitate a strategic reevaluation. While these models offer flexibility and access to a global talent pool, they also introduce legal ambiguities and responsibilities.
Employers might find direct hiring a more straightforward approach, offering clearer terms, protections for employees, and reduced legal risks. Direct employment not only simplifies the employment relationship but also provides employers with greater control over their workforce, ensuring alignment with organizational values and culture.
Conclusion
The year 2023 has been pivotal for Taiwan's employment law, marking significant strides towards creating a more equitable and safe working environment. As we look towards 2024, the onus is on employers to stay informed, adapt their policies, and prepare for further regulatory developments. The insights from legal experts like Elizabeth Pai are invaluable in navigating these changes, ensuring that employers can maintain compliance while fostering a harmonious workplace environment.
Taiwan's commitment to enhancing employment law reflects its dedication to upholding the rights and well-being of its workforce. Employers play a crucial role in this endeavor, and by embracing these changes, they contribute to a more inclusive, fair, and prosperous business landscape.
For businesses seeking to stay ahead of the curve in Taiwan's dynamic legal environment, resources and expert guidance are available through platforms like the Employment Law Alliance. By leveraging such resources, employers can ensure they are well-prepared to meet the challenges and opportunities that lie ahead in Taiwan's evolving employment law landscape.