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Asia employment law bulletin 2020

Taiwan

New protections for dispatch workers added to the Labour Standards Act

Dispatch labour and alternative employment structures have become increasingly common in Taiwan in recent years but Taiwan previously lacked any law or binding regulation addressing such employment structures. This changed in the summer of 2019, when the Labour Standards Act was amended to include new protections specifically for dispatch workers. The key points of the new provisions are as follows:

  • requiring that the labour contract between a dispatch agency and a dispatch worker shall be a non-fixed term contract, thus prohibiting a dispatch agency from terminating a dispatch worker without a statutory basis;
  • restricting dispatch clients from interviewing dispatch workers or otherwise appointing a specific dispatch worker before the worker signs a labour contract with the dispatch agency, otherwise, the dispatch client may be deemed to be the actual employer of the dispatch worker;
  • dispatch clients are now liable for owed wages to dispatch workers, if the dispatch agency is fined by the competent authority for owing wages or fails to comply with an order to pay; and
  • dispatch clients and dispatch agencies are now jointly and severally liable for employer compensation when a dispatch worker suffers from occupational accidents.

Food delivery platforms may be liable as employers of their couriers

The explosive popularity of food delivery platforms in Taiwan in the past year has also led to an increase in serious vehicle accidents involving food delivery couriers. Therefore, the Ministry of Labour has issued the legally non-binding “Guidelines for Safety of Food Delivery” for food delivery platforms’ reference. Furthermore, several of Taiwan’s labour authorities have preliminarily determined that couriers should be deemed to be employees of the food delivery platforms, rather than independent contractors as customarily assumed. If these determinations hold, food delivery platforms will be required to provide couriers with all of the benefits and protections of employees under Taiwan labour laws. These developments are likely to have implications for the wider “gig economy” in Taiwan as well.

Labour Incident Act with effect from 1 January 2020

The Labour Incident Act (which has also been referred to as the Labour Procedure Act) was approved by the Legislative Yuan in November 2018. Finally, the law took effect on 1 January 2020 according to the formal announcement by the Judicial Yuan. Several key provisions for employers to take notice of are as follows:

  • Most labour disputes will be required to be submitted to court-supervised mediation, prior to proceeding to litigation.
  • All payments that the worker received from the employer under the employment relationship shall be presumed to have been wages for the purposes of wage calculations.
  • All work hours recorded on the worker's timesheet shall be presumed to have been performed with the employer's permission.
  • In a dispute regarding whether a worker was properly terminated, the court may order a temporary injunction to require the employer to continue employment and payment of wages to the worker while the dispute is pending.

As many of the new provisions could have significant implications in future labour disputes, Taiwan employers are encouraged to consult with their legal counsel to discuss potential options to mitigate these effects.

Employment Promotion Law for Middle-aged and Elderly People

Taiwan has is an aging society. Therefore, to improve the labour participation of middle-aged and elderly people and promote economic security, the “Employment Promotion Law for Middle-aged and Elderly People” was approved on 15 November 2019 and officially announced on 4 December 2019. The law provides that employers are prohibited from discriminating against any applicant or employee aged 45 or older on the basis of age. There are also regulations that request the competent authorities to promote the re-employment of unemployed and retired workers. The law is expected to take effect in the second half of 2020, subject to a formal announcement by the Executive Yuan.

Kai-Hua Yu, LCS & Partners