Newsletter
MINIMUM WAGE INCREASED FROM JULY 2007
The Executive Yuan Council has approved a plan to increase the monthly minimum wage from NT$15,840 to NT$17,280, and the hourly minimum wage from NT$66 to NT$95, both with effect from 1 July 2007. This adjustment not only reflects an increase in the minimum wage per se, but the calculation of the new minimum hourly rate also takes into considera-tion for factor of the effect of weekends and holidays. Following this adjustment, workers who work the same number of statutory working hours will not be treated unequally based on whether their wages are calculated by the month or by the hour.
To reduce the impact on enterprises, protect workers' right to employment, and enhance the positive effect of the minimum wage increase, the Council of Labor Affairs (CLA) will apply a range of measures intended to stabilize and promote employment, which are to be introduced at the same time as the adjustment in the mini-mum wage:
．Employment stabilization subsidy for hourly paid workers
For small and medium-sized enterprises ("SMEs") in specific industries that employ up to 50 persons, a subsidy of NT$10 per em-ployee per hour will be payable to the em-ployer in respect of existing employees who work less than 32 hours per week, for a trial period of one year. The purpose of this measure is to protect employment by reducing the cost impact on SMEs, allowing SMEs with limited cash flow capabilities to more smoothly transition to the new wage rate, and maintaining enterprise owners' willingness to employ.
．Incentives for employing disadvantaged groups
An employer that employs persons from dis-advantaged groups full time or part time con-tinuously for at least three months can receive a subsidy of NT$5000 per person per month or NT$10 per person per hour for a period of up to 12 months. The purpose of this measure is to encourage enterprise owners to employ workers from disadvantaged groups, thus promoting their employment.
．Employment services for unemployed work-ers
The CLA will use data on persons leaving the Labor Insurance scheme to identify marginal workers who become unemployed, and will actively provide them with employment ser-vices, unemployment benefits, and vocational training, in order to create an all-round social safety net for unemployed workers and in-crease their rate of re-employment.
．Adjusted food and lodging payments for for-eign workers
Food and lodging payments that may be docked from the wages of foreign blue-collar workers are currently capped at NT$4000 per month, and in practice are generally set at around NT$2300 to 2500. Following the in-crease in the minimum wage, this figure can be appropriately adjusted by negotiation be-tween labor and management, with a guide maximum level of NT$5000 per month. The current maximum of NT$4000 has not been adjusted for more than five years. This measure should increase the scope for nego-tiation between employees and employers, as well as reasonably reflecting increases in the cost of living.
．Subsidies for in-service training
To further improve the work skills of persons employed by enterprises, the CLA will in-crease the subsidy for training fees up to a maximum of 80%.
The CLA also revises the salary bands in its contributions table for Labor Insurance, and in future will adjust the salary bands for pension contributions and National Health Insurance premiums.