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Compliance
Employment in Taiwan is primarily governed by the Labor Standards Act (LSA), along with laws such as the Employment Services Act and Act of Gender Equality in Employment. The Ministry of Labor (MOL) is the central regulatory body. Employers must adhere to statutory conditions regarding contracts, hours, wages, and social insurance. Violations can result in administrative fines, labor inspections, and potential civil liability.
Written contracts are strongly encouraged, especially for full-time workers, and must outline job roles, compensation, work hours, leave entitlements, and termination clauses. Fixed-term contracts are allowed but converting to indefinite-term is common after continued renewals. Employment agreements must comply with LSA provisions, and any clauses that undercut labor rights are considered void.
Standard work hours are 8 hours per day, 40 hours per week. Taiwan allows a flexible two-week working hour system and mandates at least one rest day per week. Overtime is limited to 54 hours per month and must be compensated at 134–200% of regular wages. Employers must track and record employee work hours to avoid penalties during labor inspections.
Minimum wage in Taiwan (as of 2025) is NT$27,470/month or NT$183/hour. Employers are obligated to issue monthly wage statements and pay wages in full and on time. Deductions must be legally authorized and itemized. Failure to pay wages can result in MOL-imposed fines, and repeat offenses may lead to legal actions or suspension of business licenses.
Employers must enroll employees in Labor Insurance, National Health Insurance (NHI), and contribute to the Labor Pension Fund. Employer contributions generally total around 10–15% of gross wages. Late or underpaid contributions are subject to interest and administrative fines. Insurance registration is mandatory within three days of employment commencement.
Foreign nationals require a valid work permit issued by the Workforce Development Agency before starting employment. Permitted job categories include specialized and technical work. Employers must ensure compliance with quotas, minimum salary thresholds (typically NT$47,971/month for white-collar roles), and reporting requirements. Violations result in deportation of the employee and employer penalties.
Taiwanese law provides strong protection against arbitrary dismissal. Termination must be for legal reasons such as gross misconduct, force majeure, or redundancy. Employers must give advance notice (3 to 30 days) or pay in lieu. Severance payments are mandatory based on length of service. Unlawful termination can lead to reinstatement orders and compensation.
Employees can file complaints through local labor bureaus. Common disputes include unlawful dismissal, wage disputes, and leave denials. The MOL conducts regular audits, especially for foreign labor violations and overtime abuse. Employers must maintain records for at least 5 years to demonstrate compliance.
AYP helps businesses manage full employment lifecycle compliance in Taiwan. From contract generation and payroll processing to labor insurance registration and legal updates, we support risk-free hiring and HR operations.
Expanding into Taiwan? Let AYP take care of employment compliance so you can focus on growing your business.
