Taiwan - HR & HR Software Guide

Country Overview:

Taiwan is the 7th largest economy in Asia and 22nd largest economy in the world by PPP (purchasing power parity). Taiwan is included in the World Bank’s high-income economies group and the International Monetary Fund’s advanced economies group. The country ranks high in the World Economic Forum’s Global Competitiveness Reports. Some of the country’s key industries are electronics, chemicals, petroleum refining, armaments, textiles, communications/information technology, and food processing. The services sector in Taiwan contributes nearly 73% to the GDP. Sound economic and institutional fundamentals and recent reforms have resulted in business growth.


New Taiwan Dollar

Principal Language:

Standard Mandarin Chinese


Multiparty Democratic Regime

Capital City: 


Major Provinces: 

Kaohsiung City, Taichung, Tainan City, Banqiao

Regular work schedule may not exceed 8 hours per day or 40 hours per week. Work hours can be redistributed among work days with the approval of a labor management committee or a labor union provided that the weekly work schedule is not more than 48 hours per week. A worker is entitled to at least two days off every seven days. A break of 30 minutes can be taken after 4 continuous hours of work. If the work can’t be interrupted, the break can be rescheduled.


Public holidays in Taiwan are:

  • Jan. 1-2: Founding Day of the Republic of China and the day after
  • Feb. 28: Peace Memory Day
  • May 1: Labor Day
  • Sept. 28: Confucius’ Birthday
  • Oct. 10: National Day
  • Dec. 25: Constitution Day
  • Tomb Sweeping Day: Qingming Festival of the Lunar calendar

Holidays that have variable dates are:

  • Spring Festival or Lunar New Year (3 days)
  • Women’s Day and Children’s Day
  • Festival for Visiting Family Graveyards
  • Dragon Boat Festival
  • Mid-Autumn Festival
  • New Year’s Eve (lunar calendar)

Employers must provide paid holidays to employees on non-public holidays at their discretion. Employees must receive twice their regular remuneration for working on a holiday. If employees need to work on a holiday due to an emergency, they must be paid twice their regular wages and provided compensatory time off.


Employees who have worked with the same employer for a minimum of 1 year are entitled to paid vacation based on their service length:

  • 7 days of leave for more than 1 year but less than 3 years of employment
  • 10 days of leave for more than 3 years but less than 5 years of employment
  • 14 days of leave for more than 5 years but less than 10 years of employment
  • An extra day of annual leave for each year of service beyond 10 years up to maximum of 30 days

Any unused leave is paid at the year-end. In the case of an emergency, employers can suspend an employee’s planned annual leave but must pay twice the regular wages for work during the concerned period and give annual leave after the emergency ends.

Maternity Leave

Maternity leave of 8 weeks is mandatory in Taiwan. Pregnant employees are entitled to 4 weeks of leave if the miscarriage occurs after a pregnancy of 3 months, 1 week if the miscarriage occurs after 2 to 3 months into the pregnancy, and 5 days if it occurs in less than 2 months into the pregnancy. Women who have been employed for more than 6 months are paid regular wages during maternity leave. Those employed for less than 6 months are paid half their regular wages. Additionally, a maternity grant equivalent to 1 month’s salary is paid after the childbirth. Pregnant women must be provided full pay for 5 days of leave for pregnancy check-ups.

Paternity Leave

Employees whose spouse is in labor are entitled to 5 days of paternity leave.

Sick Leave

Usually, sick leave should not be more than 30 days in a year. Hospitalized employees are entitled to unpaid sick leave for a maximum of 1 year in any 2-year period. Employees are paid half of their regular salary during the 30 days of leave in part by the employer, and in part or completely by the government’s labor insurance fund. In case an employer doesn’t pay for sick leave, the government’s labor insurance fund is used for sickness pay beginning from the 4th day of the sickness.

Family Leave

Employers with 6 or more employees have to provide paid leave to let employees deal with family matters such as caring for a seriously ill family member. Family leave can be more than 7 days every year and is debited from regular leave.

Parental Leave

Employees with more than 1 year of service and kids under the age of 3 can take unpaid parental leave for a maximum of 2 years. Those who have made contributions to the labor insurance program for a minimum of 1 year are entitled to 60% of their regular salaries for a maximum of 6 months per child. Even if 2 or more children require care at the same time, the benefit is paid for only 1 child.

Employees with a minimum work history of 15 years can retire voluntarily at the age of 55, those with 10 years of employment can retire at 60, and those with 25 years of employment can retire regardless of age. Employees who are over 65 or are unable to perform their duties satisfactorily can be asked to retire by the employer. Employers can request government permission to force the retirement of employees aged 55 or more if the job involves risk, requires substantial physical labor, or is of a special nature. Employees are eligible for benefits on retirement under the labor insurance system and labor pension system.

Labor Pension System

The Labor pension system, governed by the Labor Pension Act, requires employers to make contributions equivalent to at least 6% of an employee’s monthly salary to the Labor Pension Fund account. Employees can also contribute up to 6% of their monthly wages to their accounts which is subject to tax. Those who are aged 60 or more and have worked for at least 15 years are entitled to a monthly pension. Retirees with less than 15 years of employment receive a lump sum amount. The qualifying age increased to 61 in 2018 and will be 65 by 2026. Monthly pension benefits are based on the total contributions, average life expectancy, accrued returns, and annuity life charts.

Labor Insurance System

Employees can claim a lump-sum benefit or monthly benefits, based on their age and duration of participation in the system. Monthly payments are 0.775% of average monthly salary multiplied by the years of participation plus $3,000 or 1.55% of average monthly salary multiplied by the years of participation, whichever is higher. Employees who postpone retirement can receive higher benefits and those who retire early receive lower benefits. The lump-sum benefit is 1 month’s average wages for every year of employment during the first 15 years of insurance coverage and 2 months’ average wages for each year of insurance coverage beyond 15 years but to a maximum of 45 months’ salary.

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