As noted previously, it is generally difficult for employees in Taiwan to receive severance pay.
In particular, when employees resign voluntarily,
they are generally not entitled to severance pay,
unlike in Korea.
There are, however, exceptions.
In the following exceptional circumstances, an employer must pay severance even if an employee resigns voluntarily (Articles 14 and 18 of the Labor Standards Act):
- Where, when entering into the labor contract, the employer makes a false representation that misleads the employee and creates a risk that the employee will suffer harm
(for example, where the employer tells the employee that they will be sent to an overseas branch that does not exist when they join the company)
-
Where the employer, a member of the employer’s family, or the employer’s agent assaults or seriously insults the employee
-
Where the work specified in the contract may harm the employee’s health and the employer fails to remedy the situation after the employee asks the employer to do so
-
Where the employer, the employer’s agent, or another employee has a notifiable communicable disease that may be transmitted to employees working alongside that person and poses a serious risk to the employee’s health
-
Where the employer fails to pay the wages required under the labor contract or fails to provide sufficient work to an employee paid on a piece-rate basis
-
Where the employer breaches the labor contract or violates labor law, creating a risk that the employee’s rights and interests will be harmed
The most common examples are employers who
fail to pay wages on time,
fail to pay overtime,
or fail to enroll employees in labor insurance or national health insurance.
In such cases, even when the employee terminates the labor contract, the employer must still pay severance.
The Labor Standards Act provides, however, that
if an employee wishes to terminate the labor contract on either ground 1 or 6 above (for example, because the employer failed to enroll the employee in insurance),
the employee must terminate the labor contract within 30 days after becoming aware of the circumstances,
or within 30 days after becoming aware of the resulting harm.
Employees must therefore pay close attention to these deadlines.
In other words,
Taiwan law gives either party the right—
depending on whether the employer is at fault
or the employee is at fault—
to withhold severance or to claim it.
Sometimes, when both the employer and the employee are at fault,
and a dispute arises,
the party that first terminates the contract on sufficient grounds
may either avoid paying severance or claim it.
Therefore, in Taiwan labor disputes,
“timing” is crucial.
In most cases, the party that prepares in advance is better positioned to protect its rights.
See also:
