Act for Worker Protection of Mass Redundancy

Link to law: http://law.moj.gov.tw/ENG/LawClass/LawAll.aspx?PCode=N0020012

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Article 1


The Act to protect the workers' right to work, moderate the employer's management rights, prevent damage or potential damage to the rights and interests of workers that may result from mass redundancy of workers by a business entity, and maintain the stability of society. Matters not prescribed in the Act shall be governed by other statutes.


Article 2


The term "mass redundancy of workers" as used in the Act shall mean the circumstance where a business entity has a need to lay off its workers on account of any of the conditions set forth in Article 11 of the Labor Standards Act, including merger and restructure, and is under any of the following circumstances:
1. Where a site in the business entity having fewer than 30 workers intends to lay off over 10 workers within 60 days.
2. Where a site in the business entity having more than 30 workers but fewer than 200 intends to lay off over 1/3 of the total number of workers within 60 days, or more than 20 workers within 1 day.
3. Where a site in the business entity having more than 200 workers but fewer than 500 intends to lay off over 1/4 of the total number of workers within 60 days, or more than 50 workers within 1 day.
4. Where a site in the business entity having more than 500 workers intends to lay off over 1/5 of the total number of workers within 60 days, or more than 80 workers within 1 day.
5. The business entity intends to lay off over 200 workers within 60 days or more than 100 workers within 1 day.


Article 3


The term “competent authority” referred to in the Act shall be the Ministry of Labor at the central level, the municipal government at the municipal level, and the county (city) government at the county (city) level.


Article 4


To implement mass redundancy of workers, the business entity shall, at least 60 days prior to the occurrence of any of the conditions in accordance with Article 2, inform the officials / personal of the competent authority and other relevant agencies of its redundancy plan by a written notice and announce it by publishing an announcement, provided, that the forgoing 60-day requirement shall not apply to the case where the cause thereof is due to an act of God, calamity or accident. Notice to be given to relevant authorities/agencies or personnel under the preceding paragraph shall be given in the following order:
1. The labor union to which the worker to be laid off belong in the section or department that are involved in mass redundancy in the business entity.
2. The labor representatives of the labor-management conference.
3. The workers in the section or department that are involved in mass redundancy in the business entity, provided, however, the workers with fixed-term employment contracts specified in Article 46 of the Employment Service Act shall not be included.
The term "the entire workers" as used in Subparagraph 3 of the preceding paragraph is exclusive of the workers with fixed-term labor contracts and those of the departments unaffected by the mass redundancy.
The mass redundancy plan to be submitted by the business entity according to Paragraph 1 shall contain the following particulars:
1. The cause of such mass redundancy.
2. The department to be affected by such mass redundancy.
3. The scheduled effective date of such mass redundancy.
4. The number of workers to be laid off.
5. The criteria for selecting the subjects of such mass redundancy.
6. The method for calculating the severance pay and the job transition assistance project.


Article 5


Within 10 days from the date of submission of the mass redundancy plan in accordance with the preceding article, the labor and the employer shall enter into negotiations in the spirit of autonomy.
In the event the labor and/or the employer refuse(s) to enter into negotiations or cannot reach an agreement, the competent authority shall, within 10 days, invite the labor and the employer to form a Negotiation Committee to negotiate the terms of the mass redundancy plan, and propose alternatives if appropriate.


Article 6


The Negotiation Committee shall have 5 to 11 members, including 1 representative designated by the competent authority and an even number of representatives designated by both the labor and the employer. The representative designated by the competent authority shall act as the chairman of the Negotiation Committee. Representatives of the employer shall be designated by the employer, and the representatives of the labor shall be designated by the labor union(s). If there is no labor union but a labor-management conference is formed, the representatives of the labor shall be designated by the labor representatives of the labor-management conference. If there is no labor union or labor-management conference, the representations of the workers shall be elected by the workers in the section or department that are involved in mass redundancy in the business entity referred to in Item 3, Paragraph 2 to Article 4 of the Act upon a notice given by the business entity.
In the event that the workers and employers cannot designate, select or elect their respective representatives before the ten-day deadline in accordance with the requirements referred to in the preceding paragraph, the competent authority may, ex officio, designate such representations for them within 5 days from the next day after the expiration of the deadline.
The chairperson shall be responsible for holding a meeting of the Negotiation Committee at least once every 2 weeks.


Article 7


The agreement reached by the Negotiation Committee shall bind individual workers.
The agreement concluded by the Negotiation Committee shall be put in writing, and signed by all the members of the Negotiation Committee or affixed with their seals.
The competent authority shall, within 7 days from the date of conclusion of the agreement, submit the written agreement to the court having competent jurisdiction for its examination and approval.
The court shall examine the aforesaid written agreement as soon as possible and return the same to the competent authority. In the case of disapproval, the reasons shall be given.
In the case the written agreement approved by the court prescribes the payment of a specific sum of money, any other substitute, or valuable securities, such agreement may serve as the title for compulsory execution.


Article 8


Upon formation of the Negotiation Committee, the competent authority shall dispatch employment service personnel to assist both the labor and employer by providing them with appropriate consulting services in connection with employment service and vocational training.
The employer shall not reject the employment service personnel dispatched by the competent authority under the preceding paragraph, and shall set a time for them to provide individual assistance to the workers.


Article 9


Unless otherwise prescribed in applicable acts and regulations, the business entity that has implemented a mass redundancy plan and subsequently needs to employ workers for jobs of a similar nature shall give priority to the workers previously discharged by the mass redundancy plan.
The preceding paragraph shall also apply to the recruitment of workers by the business entity that resumes its business operations after having closed down, or by the new business entity that is organized by the major shareholders of the closed company and engages in the same business.
The term "major shareholders" as referred to in the preceding paragraph shall mean the shareholders holding a majority of the shares in the original business entity and subsequently holding more than 50% of the shares in the newly incorporated business entity.
Measures shall be taken by the government to encourage the employers to give priority to the reemployment of discharged workers referred to in Paragraphs 1 and 2 of this Article.


Article 10


In the event that an worker finds a new job during the negotiation period, the original employer shall remain liable for the payment of a severance pay or retirement pension in accordance with related acts and statutes, provided, however, if the conditions are better after negotiation in accordance with the Act, the latter shall apply.
During the negotiation period, the employer shall not arbitrarily transfer or discharge any worker who is noticed to be laid off.


Article 11


Where a business entity having more than 30 workers is under any of the following circumstances, the agency or the personnel concerned shall report the case to the competent authority:
1. The business entity has delayed the payment of wages to its workers for a period of 2 months, if the total number of its workers is less than 200 or for a period of 1 month if the total number of its workers is over 200.
2. The business entity has delayed in the payment of the premiums of its workers' labor insurance program, the overdue wages repayment fund, the premiums of its workers' national health insurance program, or the payment for labor retirement fund for a period of 2 months and the amount of payment in arrear exceeds N.T. $ 200,000 in each type of delay.
3. Its whole business or a significant part has ceased to operate.
4. A resolution for merger or acquisition is adopted.
5. A major labor dispute has occurred during the last 2 years.
The term "an agency or the personnel concerned" referred to in the preceding paragraph shall be as follows:
1. The relevant labor union or the workers of the business entity in the case of Subparagraphs 1, 3, 4, and 5; or the business entity itself in the case of Subparagraph 4.
2.The Bureau of Labor Insurance, the Ministry of Labor and tNational Health Insurance Administration, Ministry of Health and Welfare in the case of Subparagraph 2.
The competent authority shall, within 7 days after receiving the notice referred to in the preceding paragraph, make a fact-finding visit to the business entity concerned, and may, order it to offer necessary explanations or to submit its financial statements and related information within a given time limit.
When the competent authority is sending officials to make the fact-finding visit referred to in the preceding paragraph, it shall assign accountants, lawyers or other or professional experts to provide necessary assistance.
Officials of the competent authority or other personnel providing necessary assistance shall keep the financial statements and related information submitted by the business entity in confidence.


Article 12


Where a business entity delays the payment of retirement pension fund, severance pay, or wage to the workers in the course of implementing mass redundancy of workers, and, is under any of the following circumstance, and further fails to make the payments within a time limit ordered by the competent authority, the Central Competent Authority, may request, by an official notice, the authority in charge of border control to prohibit the representatives or the responsible persons in fact of the business entity from going abroad.
1. The business entity has more than 10 but fewer than 30 workers and the total delayed payment is up to N.T. $ 3,000,000.
2. The business entity has more than 30 but fewer than 100 workers and the total delayed payment is up to N.T. $5,000,000.
3. The business entity has more than 100 but fewer than 200 workers and the total delayed payment is up to N.T. $10,000,000.
4. The business entity has more than 200 workers and the total delayed payment is up to N.T. $20,000,000.
When the business entity suspends its operation and the workers terminate their employment contracts in accordance with Items 5 or 6 of Paragraph 1 to Article 14 of the Labor Standards Act, and the number of the workers hired, the number of the workers terminated their employment contracts, and the total amount of labor retirement pension, severance pay or wage in arrear are in accordance with the requirements set forth in Article 2 and all Items in the preceding paragraph, and further fails to make the payments within a time limit ordered by the competent authority, the Central Competent Authority, may request, by an official notice, the authority in charge of border control to prohibit the representatives or the responsible persons in fact of the business entity from going abroad.
The administrative regulations governing the operation procedures and other related matters to be compiled with in accordance with the preceding two paragraphs shall be prescribed by the Central Competent Authority.


Article 13


When implementing a mass redundancy plan, race, language, social station, ideology, religion, political affiliation, birthplace, gender, appearance, physical/mental handicap, age, and position in a labor union shall not be taken as the cause of discharge.
Termination of a labor contract shall be invalid if such termination is in violation of the preceding paragraph or Article 11 of the Labor Standards Act.
In the event the competent authority finds a business entity has violated Paragraph 1 of this Article, the competent authority shall order the business entity to reinstate the discharged worker within a given time limit. The competent authority shall assist the discharged worker to institute legal proceedings if the business entity fails to reinstate the worker within the given time limit.


Article 14


The Central Competent Authority shall set a specific budget to subsidize the litigation costs and necessary living expenses of the workers who suffer from unlawful mass redundancy. Regulations governing subsidized objects, standards of subsidization, subsidy application procedure, and other matters to be complied with shall be prescribed by the Central Competent Authority.


Article 15


In order to stay abreast of the changing trends of the labor market, the central authority shall form the Assessment Committee, which shall be responsible for collecting information pertaining to the causes of mass redundancy initiated by business entities for the reference of the government to formulate its policies concerning industrial development and employment.
Regulations governing the organization and operation procedures of the Assessment Committee shall be prescribed by the Central Competent Authority.


Article 16


Where the person who is prohibited from going abroad under Article 12 meets any of the following conditions, the Central Competent Authority shall request, by an official letter, the authority in charge of border control to lift the restriction:
1. The persons involved have fully paid the total amount of accumulated money in arrear for which he / she was prohibited from going abroad in accordance to Article 12 of the Act.
2. He/she has furnished a bond sufficient to secure the full payment of the outstandings that were overdue for which he/she was prohibited from going abroad by Article 12 , provided, however, within the limit of amount which the workers involved may appeal to the courts for compulsory enforcement.
3. The business entity has been dissolved and the liquidation procedure has been completed in accordance with relevant acts and regulations, and there are no residual assets for distribution.
4. All outstandings have been settled through distribution in accordance with bankruptcy procedures.


Article 17


The business entity shall be fine an amount of not less than N.T. $ 100,000 but not more than N.T. $ 500,000 for violating Paragraph 1 to Article 4 of the Act by failing to submit the mass redundancy plan to the competent authority and related government agency or officials, and failing to make a published announcement, the competent authority shall order it to resubmit or to remake a published announcement within a given time limit. If the business entity fails to comply again, it shall be fined consecutively on a daily basis unit it complies.


Article 18


A business entity shall be fined an amount of not less than N.T. $100,000 but not more than N.T.$ 500,000 under any of the following circumstances:
1. It violates Paragraph 2 to Article 5 for refusing to enter into negotiations.
2. It violates Paragraph 1 to Article 6 for refusing to appoint its negotiating representatives or failing to notify the workers to elect their negotiating representatives.
3. It violates Paragraph 2 to Article 8 for denying the presence of the employment service personnel.
4. It violates Article 10 for arbitrarily reassigning the jobs of the workers or terminating the workers.


Article 19


The business entity shall be fined an amount of not less than N.T. $30,000 but not more than N.T. $150,000 if it violates Paragraph 3 of Article 11 by refusing to make explanations or failing to submit financial statements and/or relevant information. The business entity shall be fined consecutively on a daily basis until submission is made if it is ordered to submit the documents within a given time limit.


Article 20


In case any fine imposed hereunder is not paid up within a given time limit, the case shall be subject to compulsory execution.


Article 21


The Act shall become effective after elapse of 3 months from the date of promulgation.
The amended articles of the Act shall become effective on the date of promulgation.