2 February, 2018
In the proposed amendment of the Labor Standards Act (“LSA”) introduced in December 2016, the “one mandatory day off and one flexible rest day”, the calculation of overtime working payment, and hours in rest days, interval rest hours during the switch of shift works and annual leaves were all changed in the proposed amendment only one year after the enactment of the LSA by virtue of the various public opinions to the current laws. Having considered the actual need of the society, the Executive Yuan proposed its own amendment bill to the LSA and sent it to the Legislative Yuan for review. The key aspects of the amendments are:
1 – Adjustment of the mandatory day off.
Under the current law, employees are entitled to two days off for every seven days, to wit: one “mandatory day off” and one “flexible rest day”. On the mandatory day off an employer may request an employee to work only in the event of a natural disaster, accident or emergency. As a result, except for those work in the businesses where the 4-week flexible working hours is applicable, workers in principle should have at least one day off for every 7 days. According to the Executive Yuan’s proposed amendment, however, employer and employee may agree to adjust the mandatory day off to be on any day within a seven day cycle, provided that the qualifying business sectors be designated by the Ministry of Labor and be approved by the relevant competent authority and the labor union (or the Labor-Management Meeting if there is no labor union), meaning that the employee’s date off could end up on the first and the last day of a 14-day period, resulting in the employee to work 12 days consecutively without a day off.
2 – Calculation of overtime working hours in rest days.
According to the current LSA, if the employee works on the flexible rest day, the employee is entitled to receive overtime pay for 4 hours even though the total actual working hours on that rest day is less than 4 hours. If the total hours worked exceeds 4 hours but is less than 8 hours, the employee is entitled to receive overtime pay for 8 hours. If the total hours worked exceeds 8 hours and is less than 12 hours, the employee is entitled to receive overtime pay for 12 hours. The Executive Yuan’s proposed amendment removes the rounding-up calculation method. Thus the overtime pay will be paid based on the actual working hours in the proposed amendment.
3 – Total overtime working hours per month.
While the maximum overtime working hours allowed per month remains at 46 hours in the proposed amendment, the proposed amendment allows the employer to adjust the maximum overtime working hours to 54 hours in one month within a three month cycle, provided that the consent of the labor union is obtained (or the Labor-Management Meeting if there is no labor union), and that the total overtime working hours within such month period does not exceed 138 hours (i.e. the original maximum overtime working hours for 3 months, calculated by 46 times 3). In addition, the proposed amendment provides that an employer having more than 30 employees shall notify the local competent authority for reference in the event the employer adjusts the overtime working hours as described above.
4 – The rest hours during the rotation of shift
The current Act provides that workers on shifts shall be granted a rest period of at least 11 hours continually when the shifts are rotated (please note that this rule has not come into force). While the same rule is adopted by the proposed amendment, the proposed amendment allows the employer to adjust a rest period to at least 8 hours continually after obtaining the consent of the labor union (or the Labor-Management Meeting if there is no labor union). The proposed amendment provides that the employer hiring more than 30 employees shall notify the local competent authority in the event that the employer adjusts the rest period as described above.
5 – Deferral of annual paid leave
Under the current LSA, wages must be paid in lieu of annual paid leaves which are unused during the year or due to termination of employment.
The proposed amendment allows the employee’s unused annual leaves be deferred to the following year upon agreement by the employee and employer, provided, however, that the employer shall pay the employee for any unused and deferred annual leaves if such deferred leaves are still not used at the end of the following year.
The Executive Yuan indicated that the proposed amendment protects the labor’s rights and enables the employer to have a more flexibility in management at the same time. On the other hand, the labor groups argue that such proposed amendment is controversial since it heavily damages the labor’s fundamental rights.
For further information, please contact:
Elvin Peng,Tsar & Tsai Law Firm
law@tsartsai.com.tw
