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Overdue Wages Payment Protection Upgrade: The Bureau of Labor Insurance teaches you how to protect yourself from overdue wages, severance, or the old system's retirement pension Last Modified:2016-11-03

Are employees forced to swallow their tears when they do not receive wages, severance, or the old system's retirement pension as a result of company closure or a runaway company owner? The fact is that workers are protected by the Overdue Wages Payment Fund system! To avoid the impact on livelihoods of workers caused by closures of employers, the government has stipulated the Wage Arrears Payment Fund system in Article 28 of the Labor Standards Act. Business entities are required to pay 0.025% of an employee's insurance salary to the Wage Arrears Payment Fund each month. When an employer has suspended or liquidated its business or has declared bankruptcy, then the employees with wages in arrears who did not receive payment after requesting it from the employer can apply for the fund to cover the wages in advance (maximum six months), and the Bureau of Labor Insurance (hereinafter referred to as BLI) will seek arrears payment from the employer. In order to provide more comprehensive protection to employee rights, the government amended the law on February 6, 2015 and expanded the scope of wage arrears payment to the pension and severance in the Labor Standards Act (old system), and severance in the Labor Pension Act (new system). (The total combined retirement pension and severance shall not exceed the six-month average salary.) This amendment has increased the protection of employees' finances and lives. According to the BLI, as of mid-August 2016, the total number of benefited employees has reached 59,071, of which 1,283 were covered for their severance.

Although many employees received wage arrears payment, the BLI also found that a portion of the applicants could not provide relevant proof documents, which affected their rights in applying for wage arrears payment. The BLI would like to remind employees to properly retain proof documents for wage payment, work attendance, and employment (e.g. salary envelopes, salary detail lists, withholding certificate, attendance cards, employment contracts, etc.), so when the company closes or is suspended, these records can be used as supporting documents to resolve labor-management disputes and apply for wage arrears payment. At the same time, employees should also pay attention to whether their employers have been paying into the Overdue Wages Payment Fund. If there is any uncertainty regarding whether an employer is paying into the fund on a regular basis, employees can call or write to the BLI and inquire. Employers who are not paying into the Fund are urged to abide by the law and pay.

Furthermore, if workers notice that their company has started to accumulate arrears wages, is not paying retirement pensions or severance, then the workers should immediately request that the employer provide proof stating the payment was not paid in full. Also, the labor affairs authority where the company is located should be notified, to provide the authority with an understanding of the business's operation status, which will facilitate the issuance of the proof of actual suspension date in the future. If an employer disappears after a company suspends its operation, the local competent authority should be requested to issue the proof of suspension immediately, and proof of creditor's rights should be obtained through the judicial system as soon as possible, to facilitate wage arrears payment. Although company closure may not happen to everyone, the BLI would still urge every worker to learn how to protect their own rights.

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