Getting pension law changed

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Getting pension law changed

Postby taiguy » 21 Dec 2010, 14:08

I'm interested in trying to amend the Labor Standards Law, and would appreciate advice on how to go about it. I specifically would like to have that portion of the LSL dealing with pensions amended.

Under the LSL, one's pension is calculated based on the number of years worked and the salary for the last 6 months before retirement. I work part-time, originally 3 hours a day, then 5 hours a day for several years, and now 3 hours a day again. As a result, my anticipated pension has been cut by at least 40 percent based on just my regular monthly salary, and by half or more if overtime is included.

I would like to get the LSL amended to being based on one's highest 6 months' salary rather than the last 6 months before retirement.

It seems the LSL was designed to base one's pension on one's highest salary, since one's salary usually increases over time, and one's ending salary would therefore generally be one's highest. In cases like mine, this isn't necessarily true. For part-time workers, employers can adjust one's working hours up or down, so one's ending salary ends up being unpredictable and arbitrary. There is no way for the employee to know in advance what one's pension is likely to be and to plan accordingly.

Another category of employees that might be affected is full-time workers who have their hours reduced due to economic conditions, as happened in Taiwan during the global economic recession that started in 2008. Any worker who was planning to, or forced to, retire after having their working hours (and salary) reduced would have been entitled to a lower pension than they had expected. This situation could reoccur if Taiwan's economy experiences another recession in the future.

In another case of those impacted by the last-six-months'-salary provision, I have heard that some employees who have a predictable period each year when they work overtime will time their retirement so that the last 6 months of employment include the highest overtime payments.

An amendment to the LSL to base one's pension on one's highest 6 months of salary would help each of these groups of employees and be more fair in my opinion, so I would hope that some legislators might agree and try to help change the law. I don't know what the legislative history of the LSL is or how to find out about it, but perhaps knowing that would give me some idea of which legislator(s) to approach for help. It would be interesting to know who drafted the law, whether a government agency like the Bureau of Labor Affairs, or a legislative committee, so I'd know who to talk to. I'd particularly like to know the rationale for basing a pension on the last 6 months' salary. I would guess that the drafters figured that would be one's highest salary, but if so, they didn't take account of all the exceptions, so my proposed amendment might keep the actual outcome more in line with the original intention.

If anyone knows how I might go about trying to get the law amended, I'd appreciate their input.
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Re: Getting pension law changed

Postby spaint » 22 Dec 2010, 10:04

I guess you have ROC citizenship, because as far as I know, foreigners aren't permitted to participate in the government pension plan.

Sorry that I can't help you, but I'm interested in hearing about your progress. Good luck!
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Re: Getting pension law changed

Postby taiguy » 23 Dec 2010, 11:37

Foreigners can participate in the pension scheme under the Labor Standards Law but not under the newer Labor Pension Act.
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Re: Getting pension law changed

Postby *monkey* » 23 Dec 2010, 14:38

taiguy wrote:It seems the LSL was designed to base one's pension on one's highest salary, since one's salary usually increases over time, and one's ending salary would therefore generally be one's highest.


It certainly sounds like you lost out financially and that was some really bad luck. However, severance pay is also calculated on the average monthly wage during the six months before termination of employment. It would be illogical to base the pension on a different period of time to severance pay.

Also, I think you are wrong about the intent of the law. If the bureaucrats and legislators who put this law together had intended pension payments to be based on the highest salary earned (rather than the final salary) then they would have specified it in the LSL.

In traditional Taiwanese companies, VPs and presidents who outlive their usefulness are usually shuffled off to a small, dusty office and given an important sounding title that carries little if any responsibility and power. They'd probably only get a fraction of the salary they earned in their prime. My guess is that the LSL was designed to take into account this kind of scenario.
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Re: Getting pension law changed

Postby snowy » 21 Nov 2011, 15:00

Not sure if this updates what you all have been posting here, but it looks like foreign spouse are eligible to join the new labour pension scheme effective from 1 Jan 2012. Related text here -> Broken Link
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Re: Getting pension law changed

Postby cranky laowai » 21 Nov 2011, 15:40

That link didn't work for me. I looked around the same site and found the text below on p. 3 of the June 15-30 issue of the National Immigration Agency's biweekly newsletter.

Once the amendment to the Labor Pension Act is implemented on Jan. 1 next year, foreign and mainland Chinese spouses of Taiwanese nationals, including non-citizens, will become eligible for voluntary contributions to retirement pension funds. Employers covered by this program are required to allocate 6 percent of their employees’ salaries toward retirement pension funds. These workers can also contribute an additional 6 percent of their salaries for their pension fund. If the marriage between a Taiwanese national and a foreign national should terminate, the latter will still be covered under the Labor Pension Act as long as he or she is employed within Taiwan. The act stipulates that, if an employer should fail to abide by the requirement by either reporting an erroneous amount or not reporting at all, the Cabinet-level Council of Labor Affairs (CLA) will make the necessary adjustments. The CLA proposed the amendment in August 2009, four years after the Labor Pension Act was implemented.

明年元月1日勞工退休金條例修正案實施後,臺灣公民的外籍或大陸配偶,不論是否已取得公民身分,均可自行提繳部分薪資加入勞工退休基金。有關雇主為其提繳薪水之百分之6,雇員本身亦可另行提繳薪水百分之6納入其勞工退休金帳戶。外籍配偶與臺灣公民離異後,倘仍在臺灣受雇,將繼續受到勞工退休金條例規範。根據勞工退休金條例,雇主違反規定,誤報或不報金額,行政院勞工委員會得予糾正。勞工退休金條例實施4年後,勞委會在2009年8月提出上述修正案。


That sounds like what I'm already getting -- or at least receiving according to my pay stubs. But I'm reluctant to ask the HR office much about this lest they say, "Oops! We shouldn't have done that and need to remove that money."
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Re: Getting pension law changed

Postby John » 21 Nov 2011, 22:22

Would be nice if that included ALL permanent residents (APRC holders) , not just the foreign spouses.
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Re: Getting pension law changed

Postby snowy » 19 Dec 2011, 16:02

snowy wrote:...foreign spouse are eligible to join the new labour pension scheme effective from 1 Jan 2012...


Checked with my company's HR people on this. They recently phoned the CLA on my behalf and the feedback I got is it turns out the government has not yet considered how to actually implement this yet. Oh boy...
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Re: Getting pension law changed

Postby Belgian Pie » 19 Dec 2011, 16:23

First get the money ... then start thinking about the use ...
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