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1.What is the “ Wage Arrears Payment Fund”? What are the purposes of the fund? Where can I access to the relevant information?

  1. Wages are paid to workers in compensation for the services they provide. Wages are the major economic supports for the life of the worker and his/her family, while retirement pension and severance pay are the thread of their (retired) life. The protection of wage, pension and severance pay, therefore, is always very important to the workers. As a result, the government has specifically designed the “ Wage Arrears Payment Fund System” under the Labor Standards Act to provide additional protection. For all business entities applicable to the Labor Standards Act, the employer is required to allocate a small amount of money (0.025% of the total insured salary) each month as the contribution to the Wage Arrears Payment Fund. When the employer encounters business closedown, liquidation or declaration of bankruptcy, the workers may receive payments from the Wage Arrears Payment Fund to cover the part of wages, pensions and severance pays. The employer is required to reimburse the advanced money to the Wage Arrears Payment Fund within a specified period.
  2. On a regular basis, the employers contribute to the Wage Arrears Payment Fund for their employees, which serve a similar purpose as the wage insurance. When the company is facing financial difficulty and unable to pay the wages, pensions and severance pays, the employer may, after the closedown of the company, apply to the Bureau of Labor Insurance to pay the overdue wages, pensions and severance pays on behalf of the employer, thereby assuring proper protection to the hard-working laborers.
  3. You are welcome to visit the global website of the Bureau of Labor Insurance ( for detailed information about the Wage Arrears Payment Fund, as well as the relevant information regarding the Labor Standards Act, its ancillary regulations and rulings.
Last Update:2019-11-09