• Last updated:2021-10-18

   In order to stimulate the economy, boost new domestic investment, and encourage overseas Taiwanese businesses to return and invest in Taiwan, the Executive Yuan invited the Council for Economic Planning and Development, the Ministry of Economic Affairs, and the Council of Labor Affairs to come to a joint decision regarding foreign workers. The Boost Domestic Investment Proposal approves raising the quota for hiring foreign workers by 5% or 10%. Furthermore, companies hiring foreign workers will be exempt from paying the additional employment security fees for a period of 3 years. Returning overseas Taiwanese investors are permitted to hire an extra 15% or 20% foreign workers, and will be exempt from the Employment Stability Fee for a period of 5 years. At the end of this period, employers must return to the 3K5 five-ratio system, and pay the additional employment security fees for any extra foreign workers employed. The Council of Labor Affairs is currently working on the law making process related to the aforementioned system of employing of foreign workers in the manufacturing industry.

Through dialogue the government has collaboratively formulated foreign worker policy
   The government has followed the Employment Services Act Article 42 as its guiding principle for the hiring of foreign workers. The Act states that the employment of foreign workers must not affect the employment opportunities of Taiwan nationals, nor must it effect Taiwan''s labor requirements, the development of the national economy, or social stability. Therefore, under the fundamental principle that it will not affect the employment opportunities of Taiwan nationals, the Council of Labor Affairs has increased the hiring quotas for foreign workers in order to provide additional lower-level workers; it is hoped that this will combat the domestic shortage of industrial workers; and, through the Transnational Migration of Labor Policy Consultation Committee''s （from here on abbreviated to Policy Committee） abor, management, academia and government social dialogue mechanism a suitable foreign worker policy, in accordance with the economic development needs and the current employment situation, has been collaboratively formulated.
   The current manufacturing industry foreign labor policy was jointly deliberated upon and reviewed by the Council of Labor Affairs and the Ministry of Economic Affairs. A consensus was reached by the Policy Committee through social dialogue. Taking into account the current labor shortage situation, the industry-relational degree, and the 3K industries characteristic model（this is adopted from the Japanese kitsui, kitanai, and kiken industries; in English it would be 3D, or difficult, dirty, and dangerous）, the manufacturing industry graded five-ratio system was put into place in 2010. This system adjusted the foreign labor hiring quota for each industry in a five-ratio system of 10%, 15%, 20%, 25% and 35%. Under the new 3K system, traditional industry, and small and medium enterprises, can increase their foreign worker hiring quota. However, the hiring quota for the electronic information industry and for major enterprises will be reduced. The new system uses the calculation labor insurance quantity multiplied by allocation rate, meaning that if companies increase the number of Taiwan nationals they employ, then they can also adjust the number of foreign workers they employ accordingly. In this way, foreign worker quotas can be effectively allocated to the manufacturing industry, while safeguarding jobs for Taiwan nationals. This in turn will help maintain the operation and development of enterprises.

Formulation of the new "additional employment security fees, increase foreign worker quotas" mechanism
   However, for some enterprises that do not have low salary worker cost special requirement, the new ''add the Employment Stability fee, increase the foreign worker quota'' mechanism has been formulated, and has been planned in accordance with caution and keeping foreign worker salaries close to those of Taiwan workers. Under this premise, the Council of Labor Affairs has agreed that enterprises that increase the number of foreign workers they hire by "5% and below", "6-10%", and "11- 15%" will be required to pay an additional employment security fees of NT$3,000, NT$5,000, and NT$7,000 respectively. In order to respond accordingly to the flexible employment needs of industries with labor shortages in special situations, the highest foreign worker allocation rate permitted is still 40%.
   The system of the manufacturing industry using foreign workers is adjusted on the basis of the 3K five-ratio system, and the "add the additional employment security fees, increase the foreign worker quota" system has been newly established. Employers are required to pay the extra Employment Stability Fee to prove that they are hiring foreign workers due to a shortage of workers and not because of inadequate work conditions. Additionally, with regards to incentives for new domestic investment cases and returning Taiwanese businesses investment cases, the objective of investing in the building of a new factory within a certain period of time, as well as creating employment opportunities for Taiwan nationals must be achieved; they must be short term incentive measures and create employment opportunities for Taiwan nationals; a punitive inspection mechanism will be established at the same time in order to both safeguard the employment opportunities of Taiwan nationals, and satisfy the needs of employers that lack manpower.

• Source:Department of General Planning
• Publication Date:2013-02-19
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