Negative impact of Taiwan’s new work schedule law
Taiwan’s 1111 Manpower Bank released its survey of wages and salaries and Taiwan’s job market in 2016 on February 18, 2017. It says that compared to 2015, Taiwan’s salary levels in 2016 dropped by 0.6%. Salary levels in financing, insurance and investment consulting dropped by 3.6%, the salary levels in construction dropped by 2.58%, the salary levels in tourism, recreation and sports businesses dropped by 1.5%.
Salary levels in transportation and warehousing on average rose by 2.8%, salary growth in law, accounting and consultancy rose by 1.6%, and salary levels in mass communication rose by 0.39%.
Overall, 82.1% of desk job workers are not content with their current salary. The yes123 job search service calculates that of Taiwan’s 8,906,000 hired workers, 7,312,000 of them are not satisfied with their current income. Taiwan’s desk job workers hope their 2017 salary can be adjusted upwards by 8.7%.
Taiwan’s 104 Data survey of 638 responses conducted on January 24 to February 9, 2017, shows that the actual salaries of 30% of desk job workers have been reduced by their company’s control of overtime and reduction in overtime pay, 52.7% of them are thinking of leaving their current job, 76% want to take up side jobs, 35% say their companies are paying overtime according to the new work schedule law, 34.1% say that are “not sure”, 31% say their companies are not paying overtime pay, and 44% or workers do not have the courage to complain for lack of pay due them because of the new work schedule law.
The 104 Data survey of 938 businesses conducted on January 20 to February 3, 2017, shows that 30.4% of the businesses are adjusting their overtime system, 26.6% are adjusting their scheduling system, 48.3% of businesses say they respond to worker enquiries about the new work schedule “passively”, 19.9% say they have not explained the new work schedule law to their employees, and internal communication within the businesses is “passive”, 73.4% of businesses think the new work schedule law has a negative impact. Many businesses say the new work schedule law is an added burden on human resources management and has squeezed out human resources development, 78.9% say the new work schedule law will negatively impact Taiwan’s competitiveness, 27% say Taiwan’s competitiveness will be greatly reduced because of the new work schedule law, 51.9% say the new law will have some negative impact on competitiveness.
Taiwanese businesses say the new work schedule law will reduce business profits and drive the businesses to be more conservative, the new law will worsen labor-management relations, and the new law will increase labor costs and reduce the company’s capacity to win international orders.
A Taiwan business Weekly survey of 920 businesses released on February 17, 2017, shows that 61.9% of businesses will be more conservative in salary increases because of the new work schedule law, 48.3% will adjust the workers’ salary structure, 54.9% of workers believe the bosses want hire one worker to work as two, 40.2% of bosses believe their workers’ work efficiency is not good, 38.8% of workers do not want more rest days, 44% worry about tighter job performance review, and 13.9% worry they will be laid off because of stricter job performance reviews, 37.1% are under greater pressure to get the job done earlier because of the new work schedule law, 63.3% of businesses worry that labor-management relations will worsen because of this new work schedule law, 62.9% believe company profits will be reduced because of this new work schedule law, 49.3% believe the rise in labor cost will negatively impact efforts to win overseas orders, 48.3% of businesses are thinking of leaving Taiwan to invest overseas and move work opportunities abroad because of this new work schedule law. Among workers 45 to 65 years old, 36.2% think that even if they wanted to work overtime, they will not be allowed because of this new work schedule law, and 26.9% of workers under 45 years old think so, 83.2% of businesses believe the new work schedule law will raise labor cost, 66.4% believe the new law makes it more difficult for personnel deployment, 51.7% believe it will make labor-management relations more tense, 48.6% believe operational costs will be negatively impacted, 46.5% believe their modus operandi will have to be changed, and 36.7% believe their original production capacity and services will be difficult to maintain because of this new law.
A joint survey by the general chamber of industries and the general chamber of businesses conducted on January 20-26, 2017, of 735 businesses shows that 67.4% of businesses think the new law will create scheduling problems, 67.8% “cannot accept” the newly mandated overtime pay scale of counting “each hour of overtime as four hours”, 46.3% of businesses say they will raise prices, 15.5% say they will hasten automation, 14.2% say they will move their production lines out of Taiwan, 6.2% say they will shut down, 53.7% say they will not raise prices, 72.8% of businesses say the new law will increase their annual personnel cost by over 3%, 27.2% say their personnel cost will increase by 1% to 3%, 51.3% say they will limit overtime hours, 24.4% say they will hire more temporary workers, 15.6% will contract work that used to be done in house, 8.8% say they will cut business hours.
Some suggestions by businesses include 21.8% that want to eliminate the quadruple overtime pay requirement, 18.7% that want to return to double time pay for overtime, 15.9% do not want rest day overtime to be included in the monthly extended work hours, 15.7% that want to increase the 46-hour limit on monthly extended work hours to 56 hours, 60 hours or up to 66 hours, 14.3% want to “ease” the strict one rest day per seven days rule, and 13.7% want to “ease” this rule for different professions.
A survey by Taiwan’s Cathay Financial Holdings show that 44% of respondents believe the new work schedule law will be more detrimental than beneficial, 9.8% believe it will be more beneficial than detrimental, 23.6% believe salaries will be reduced, and 8.8% believe salaries will increase due to the new work schedule law.
Another indication that Taiwan’s is losing its competitiveness is reflected at the Yunlin Douliu job center. One company is trying to hire machinery operators and it requires the machinery operations to move the equipment. It is offering a monthly salary of NT$76,000, but there has been no enquiries for the job.
At other booths where 9-5 desk jobs in quality control are being offered at NT$23,000 to NT$25,000, several hundred job applicants line up for interviews.
Thirty manufacturers and businesses in six major industries are participating in the Yunlin Douliu job fair center.