In the Committee’s 2020 White Paper, we raised the following four proposals:
Allow employers to apply directly for a release from restrictions on working conditions for employees with monthly salaries of NT$150,000, even if such employees are not deemed “supervisory or administrative personnel” according to Article 50-1 of the Enforcement Rules of the Labor Standards Act;
Consider the factors on the Ministry of Labor’s (MOL) checklist for determining whether an employment or contractor relationship exists in their totality;
Re-evaluate the requirement for large-sized enterprises to hire nurses as it does not accurately reflect the current labor environment; and
Recognize the value of independent and flexible work arrangements under the digital economy.
We deeply appreciate the National Development Council’s (NDC) positive responses to the above-mentioned proposals, particularly its agreement to consider removing the “supervisory or administrative employee” prerequisite for applying for more flexible working conditions. In addition, the MOL agreed to conduct a thorough evaluation of its checklist in the future.
This year, we offer the following suggestions.
Suggestion 1: Adopt more flexible working conditions for high-salary personnel and codify the principle of safe harbor for gig workers into law.
1.1 Create a high-salary personnel sandbox to test flexible working conditions.
On May 23, 2019, the MOL issued a ruling stating that employers may apply for release from restrictions on working hours, regular leave, rest days, and night and holiday work by female employees in the case of supervisory or administrative employees with monthly salaries of NT$150,000 or higher.
However, workers with salaries of NT$150,000 or higher and who are tasked with supervisory or administrative duties are normally deemed mandated managers, not employees, and there is therefore no need for an employer to apply for such a release for them. This issue was previously raised by the HR committee, and we urged the competent authority to continue to give attention to this issue and remove the “supervisory or administrative employee” prerequisite in due course.
In addition, the COVID-19 pandemic has given rise to new working conditions globally. Many companies, especially those in digital and knowledge-based industries, no longer require their employees to provide services in a fixed workplace. Remote work has been widely adopted. As current laws and regulations may not be suitable for certain new business models, including those with less obvious supervisor-subordinate relationships, we suggest that the competent authority consider adopting a “sandbox” approach that would allow employers to experiment with more flexible working conditions that may be outside the applicable laws and regulations. Such a sandbox would allow for the development of practices specific to the unique features of each business. The competent authority could then evaluate the outcome of each sandbox experiment and decide whether to amend the relevant laws and regulations.
1.2 Implement a safe harbor provision to allow companies to provide more and better benefits to gig workers.
Online platforms and companies in Taiwan have found that each additional benefit they offer to independent contractors to improve the safety and quality of their work become, in the eyes of labor auditors and the courts, further evidence of a supervisor-subordinate employment relationship.
We urge the MOL to consider the inclusion of a safe harbor clause in its “Directions for Classifying an Employment Agreement” and checklist for determining the type of employment relationship. In making its decision, the MOL may refer to the Helping Gig Economy Workers Act of 2020, introduced in the U.S. House of Representatives last May. The proposed bill seeks to allow digital marketplace companies to provide certain benefits to workers during the COVID-19 pandemic without such actions establishing workers as employees.
We propose that the following text be used for such a clause: “Any non-mandatory measures adopted by enterprises to enhance the safety, protection, and benefits of service providers shall not be deemed characteristics of an employment relationship.”
A safe harbor clause would ultimately allow enterprises to do more for independent contractors and would benefit relevant stakeholders, creating a win-win regulatory environment for all.
Suggestion 2: Count disabled people hired through third-party service providers in calculating the total number of disabled employees at a company.
Article 38 of the People with Disabilities Rights Protection Act (PDRPA) provides that a private business organization whose total number of employees is no less than 67 shall employ people with disabilities who are capable of working, and the number of employees with disabilities shall be no less than 1% of the total staff and no less than 1 person.
However, headcount openings at major multinational enterprises have increasingly been managed by headquarters under a global strategy. Local subsidiaries usually can thus no longer independently make decisions regarding full-time headcounts.
Furthermore, in order to strengthen and streamline operations, a recent trend at multinationals is to outsource most non-core operations at local subsidiaries (e.g., catering, housekeeping, security, reception, office services, toll-free phone number operation, shipping, promotion, warehousing, IT maintenance, and fleets) to professional service providers, which offer training and career development opportunities for their employees.
This new business model provides a unique opportunity for disabled people, especially as the concept of “social enterprise” has gained in popularity. Third-party service providers that hire disabled people provide them with good training and a friendly working environment. Such enterprises can partner with multinationals to achieve the goal of offering more job opportunities to disabled people.
Considering the changing business environment in Taiwan, the Committee recommends amending the PDRPA to count disabled workers employed by professional services providers and outsourced by companies in the total number of disabled employees hired by a company. Such a revision would not only ensure more full-time job opportunities for disabled people, but would also provide an incentive for multinational companies in Taiwan to hire more disabled workers through social enterprises.
Suggestion 3: Amend the temporary status quo injunction under the Labor Incidents Act to ensure the stability of the Taiwan labor market.
Article 49 of the Labor Incidents Act allows for an employee to file an injunction for temporary reinstatement and payment of wages if a court recognizes that the employee has a chance of prevailing in a labor dispute and said temporary reinstatement presents no major difficulties for the employer. In addition, Article 487 of the Civil Code provides that in the event that an employer delays accepting services from an employee, such as may be the case in a labor dispute, the employee may demand remuneration without being bound to perform those services. The application of these two articles would prevent the employer from requesting the return of wages for services actually performed by the employee during the temporary reinstatement period, even if the employer later wins the lawsuit and provides proof of wrongdoing by the employee.
However, the Labor Incidents Act explicitly states that it was enacted to supersede the Code of Civil Procedure and the Compulsory Enforcement Act for procedural matters in connection with labor disputes. The Labor Incidents Act is categorized as procedural law, and as such cannot create or expand any substantive rights and obligations in an employment relationship, which is governed by the Civil Code, Labor Standards Act, and other relevant regulations. Neither the Civil Code nor the Labor Standards Act obligate an employer to accept services provided by an employee, which is a fact that has been recognized and confirmed in prior Supreme Court decisions.
Given the above, the Labor Incidents Act should not entitle an employee to file a motion of provisional injunction for interim reinstatement against the employer’s will. We therefore suggest that Article 49 be amended to require the employer’s consent for the grant of temporary reinstatement with pay or to provide employers with the option of paying wages to such employees without accepting their service. Employers should be consulted before a decision on which temporary solution is appropriate. The amended version of the article would read as follows:
I. If the court recognizes that the case for confirming the existence of an employment relationship, as initiated by the worker, has a chance to prevail, and that the employer has no major difficulties in continuously employing the worker, the court may order a temporary status quo injunction based on the worker’s motion for interim reinstatement with wages if the employer agrees or for payment of wages without continuous employment. The type of injunction shall be decided after consulting the employer.
II. If the court of first instance delivers a judgment recognizing the existence of an employment relationship, the court shall make a disposition in favor of the worker’s motion as presented in the preceding paragraph.
III. The court shall exempt the motions, as described in the preceding two paragraphs, from the requirement of a security.
IV. If the court revokes a ruling, as mentioned in paragraph 1 and paragraph 2, due to the worker receiving a binding and losing judgment, the court may, on the employer’s motion, order the worker to return the paid wages within the scope of revocation, and the accrued interest since the date of receiving the wages. However, this provision does not apply if the worker has provided labor services pursuant to the ruling, as described in paragraph 1 and paragraph 2, and if the employer has expressed no objection to the worker’s provision of service.
V. The ruling ordering the return of paid wages, may be appealed, and the execution of the ruling stays, pending such appeal.
The proposed amendment provides the following protections to both employers and employees:
It gives the employer the right to decide whether to accept the services provided by the worker, without affecting the worker’s right to continue receiving wages under the temporary status quo injunction.
It provides the employer with the right to claim the return of wages after prevailing in a labor dispute. Namely, it allows employers – during litigation proceedings for reasons related to confidentiality, information security, or personnel considerations – to refuse the services of employees entitled to receive remuneration in accordance with Article 487 of the Civil Code.
It allows the employer to decide on a case-by-case basis whether to temporarily reinstate employees during a labor dispute or merely to pay them wages. The amendment provides flexibility for the employer while protecting the interests of the employee.