Obtaining Severance Pay

Hi all,

I need some advice on how to force an employer to pay me my severance pay.

I’ve worked at a small English buxiban in Taipei for nearly two years. Recently the boss terminated my contract. They didn’t mention anything about severance pay. When I looked at my contract and the Labor Standards Act, I discovered I was legally entitled to a substantial sum, that was proportional to the length of time I had been employed at the school. I notified my boss and he got angry. Then I was contacted by the company’s general manager - a separate person to my boss at the school. I was persuaded to attend a meeting with my boss and the general manager to discuss the severance. At the meeting they produced a printout in Chinese from what looked like a website for calculating Taiwanese severance pay, with a figure for the severance pay that was significantly lower than what I had been expecting. They explained that this was because severance was calculated from the starting date of the contract being terminated; although I had worked at the school for almost two years, my contracts were only for one-year stretches. Thus I had completed one year long contract and been terminated towards the end of the second, and they claimed that only the time in the second contract counted towards calculating severance pay. The figure on this printout was circled, and the general manager then scrawled ‘we agree to this severance pay’ and signed and dated the paper with a ballpoint pen. I was then pressured into signing the same piece of paper. We did the same thing with another identical copy of the printout, which was given to me.

I have since discovered that they were lying - severance pay IS calculated from the TOTAL length of time worked at the company, not just from the single yearly contract being cut short. So according to my original contract and the Labor Standards Act, I should get a lot more than the sum specified on the printout I have. I have requested a mediated meeting at the Labor Department in City Hall to try and get this larger sum.

My question is: which is more important in determining what the company should pay me - the printout that I and the general manager agreed to and signed, or my original work contract plus the Labor Standards Act? It’s true I signed the printout with the lower sum. But if they lied and intimidated me into signing it, does it count? (It was a pretty nasty meeting.) And would a printout of a smaller figure, with ‘we agree to this sum’ and two signatures written on it, override my original work contracts, which clearly state that I can only be dismissed in accordance with the Labor Standards Act? I’ve seen mention on these forums of some people using the Labor Standards Act to get severance pay even after they had signed contracts saying they weren’t entitled to it, or were entitled to less. Is this possible? Or am I just screwed?

I would also be interested in hearing any stories of English teachers’ severance pay disputes settled by Labor Department mediation. Is this an effective method? What are the mediators like? Are rulings consistent, or is it a crapshoot? Do companies often abide by the rulings?

Thanks in advance.

If the contract (printout) that you signed is less favorable to you than your entitlement under the Labor Standards Act, the contract is invalid, even though you signed it. You can explain that to your boss and general manager, and if they still won’t pay you what you are entitled, let them know that you will be visiting the Ministry of Labor to ask for their assistance in claiming your rightful severance pay.

Thanks for the advice Rotalsnart. I was hoping that was the case.

I’d still be interested to hear about any pay disputes resolved (or not) by the Labor Department.

It seems very likely that you can win the severance case. The signed paper could make it interesting though. Something like that should be illegal and fineable but they might have gone through a lawyer. Let us know how it turns out.

[quote=“winterfritz”]The figure on this printout was circled, and the general manager then scrawled ‘we agree to this severance pay’ and signed and dated the paper with a ballpoint pen. I was then pressured into signing the same piece of paper. We did the same thing with another identical copy of the printout, which was given to me.

My question is: which is more important in determining what the company should pay me - the printout that I and the general manager agreed to and signed, or my original work contract plus the Labor Standards Act? It’s true I signed the printout with the lower sum. But if they lied and intimidated me into signing it, does it count? (It was a pretty nasty meeting.) And would a printout of a smaller figure, with ‘we agree to this sum’ and two signatures written on it, override my original work contracts, which clearly state that I can only be dismissed in accordance with the Labor Standards Act? I’ve seen mention on these forums of some people using the Labor Standards Act to get severance pay even after they had signed contracts saying they weren’t entitled to it, or were entitled to less. Is this possible? Or am I just screwed?[/quote]
“Settlement and compromise” is a real thing in the Civil Code, i.e. you can waive a claim in exchange for something, even if you were already entitled to that thing. However, there are also provisions for juridical acts (such as signing settlements) being invalidated for this or that reason. A proper settlement is supposed to be ironclad, i.e. you don’t even need to file a lawsuit to get it enforced, but a proper settlement for a labor-management dispute is supposed to be reached through mediation by an approved neutral party (the labor department, a mediator approved by the department, or a court appointed mediator), in accordance with laws & regulations outside the Civil Code. I don’t know of any case like this, but the fact that they didn’t follow the proper procedure is a strong argument in your favor.

Btw, some people working directly or indirectly for the government still don’t know (or pretend not to know – and I’m not joking, unfortunately) that unmarried foreigners are not subject to the Labor Pension Act. Before your mediation session (which the labor department will schedule at your request), download the Labor Standards Act and the Labor Pension Act in English and Chinese and be ready to show the relevant articles to the mediator (Art. 7 of the LPA iirc). If the mediator happens to be among those who just don’t get it, remember you don’t need to accept the mediator’s proposed settlement; if you don’t settle, you can still go to court, if you have time.

A standard settlement includes a promise not to take any further action against the other party, so if you want to get them fined, ask the labor department to inspect the buxiban, before mediation. The department may be lazy and say the case is already settled, but if 30 days passed between the termination (the actual termination date not the notice date) and the payment, the buxiban should have a problem. Also look through the LSA for other possible violations. They may owe more (to you and/or the labor department) than you think.

One more thing, did they give you a 服務證明書 “proof of service record” saying when you started and finished working for them? If not, ask for it before they find out you’re taking further action.

[quote=“yyy”]
Btw, some people working directly or indirectly for the government still don’t know (or pretend not to know – and I’m not joking, unfortunately) that unmarried foreigners are not subject to the Labor Pension Act. Before your mediation session (which the labor department will schedule at your request), download the Labor Standards Act and the Labor Pension Act in English and Chinese and be ready to show the relevant articles to the mediator (Art. 7 of the LPA iirc). If the mediator happens to be among those who just don’t get it, remember you don’t need to accept the mediator’s proposed settlement; if you don’t settle, you can still go to court, if you have time.[/quote]

Thanks for clarifying this. This is in fact the other way in which the company is trying to cheat me - they used the LPA to calculate the severance, giving a sum that is half of what the LSA guarantees. Together with the fact that they are counting less than half of my actual service period it means that they’re only offering around a quarter of what I’m entitled to under the LSA.

I have prepared copies of the relevant parts of the LSA and LPA in English and Chinese as you have advised. (Yup, it is article 7 of the LPA). Hopefully I’ll get lucky with the mediator - although I understand that I can ask to meet with the mediator before the meeting; is this correct?

In any case, my contract clearly states, in English and Chinese, that I am to be dismissed ‘in accordance with the Labor Standards Act’ rather than the LPA.

[quote=“yyy”]
One more thing, did they give you a 服務證明書 “proof of service record” saying when you started and finished working for them? If not, ask for it before they find out you’re taking further action.[/quote]

They gave me a 離職證明書 which I’m guessing is the same thing. The only trouble is that the dates are wrong. The ‘start date’ listed is the start of the contract being terminated ie last year, rather than the date I started working at the school two years ago. I’m guessing they did this so as to back up their bogus calculation of the severance pay. The end date is also wrong, about two weeks prior to the actual date on the termination agreement.

How necessary is a correctly dated 服務證明書? I already have originals of my two consecutive work contracts, which clearly give the date at which I started at the company, as well as the termination agreement that I signed and they stamped at the meeting last week, which gives my end date.

On the other hand, can I use the incorrectly dated 服務證明書 to argue that they have already violated the LSA? I notice that Article 19 states they cannot refuse a request for a 服務證明書. Furthermore, the incorrect 服務證明書 has a declaration that ‘the above information is true to our knowledge,’ and has been stamped by the organization. Are there penalties for lying on a document like this?

[quote=“winterfritz”]I have prepared copies of the relevant parts of the LSA and LPA in English and Chinese as you have advised. (Yup, it is article 7 of the LPA). Hopefully I’ll get lucky with the mediator - although I understand that I can ask to meet with the mediator before the meeting; is this correct?

In any case, my contract clearly states, in English and Chinese, that I am to be dismissed ‘in accordance with the Labor Standards Act’ rather than the LPA.[/quote]
It never occurred to me to ask about that :ponder: . It shouldn’t be necessary, but I guess it doesn’t hurt to try. Either way, get a lot of patience ready. If the employer is trying to play a “long game”, the mediation will turn out to be a complete waste of time (but still necessary before going to court).

In general, the mediators who work directly for the government are more useful than the outsourced (“civil society”) ones; the catch is that you need to wait longer.

[quote=“winterfritz”]They gave me a 離職證明書 which I’m guessing is the same thing. The only trouble is that the dates are wrong. The ‘start date’ listed is the start of the contract being terminated ie last year, rather than the date I started working at the school two years ago. I’m guessing they did this so as to back up their bogus calculation of the severance pay. The end date is also wrong, about two weeks prior to the actual date on the termination agreement.

How necessary is a correctly dated 服務證明書? I already have originals of my two consecutive work contracts, which clearly give the date at which I started at the company, as well as the termination agreement that I signed and they stamped at the meeting last week, which gives my end date.

On the other hand, can I use the incorrectly dated 服務證明書 to argue that they have already violated the LSA? I notice that Article 19 states they cannot refuse a request for a 服務證明書. Furthermore, the incorrect 服務證明書 has a declaration that ‘the above information is true to our knowledge,’ and has been stamped by the organization. Are there penalties for lying on a document like this?[/quote]
The administrative penalties are all listed in the “Penal Provisions” Chapter near the end of the LSA, and you may find that the city has its own detailed list of how much to charge for an employer’s 1st violation, 2nd violation, etc. Iirc Art. 19 is one of the general violations in Art. 79 ($20,000 to $300,000), but the standards for a 服務證明書 or 離職證明書 are not firm. A case of blatant fraud would probably result in a penalty, but a case of "oh sorry we made a mistake :laughing: ", probably not :unamused: . You can ask them to issue a correction with the proper dates, and if they refuse, that’ll be more ammunition :wink: .

Damn, that’s some shady ass shit. Best of luck dude.

winterfritz, any update on your case?

How did the Labour Board rule?

Updates please!

cheers

I would sue their asses and enjoy them squirm.
But that would take time and money I know.

hi, general question related to this post… How much severance is one entitled to based on working about one year? Is it a month’s salary? more than that, less than that? please advise, thanks!

AFAIK It is one months salary added to severance each year.

Via referral from the Mighty @yyy:

an equivalence of half a month of average wage for every full year of employment, and in proportion for employment less than one full year; the foresaid severance shall not exceed more than six months of average wage, and is not applicable to Article 17 of the Labor Standards Act.

That’s correct for anyone in the new pension system, so the answer to Gav’s question would be half a month’s salary.

For anyone in the old pension system, the severance provisions of the Labor Standards Act still apply, so the answer would be 1 month’s salary (for service of anywhere from 11 months + 1 day to 12 months).

(I’m actually not sure whether the rule that you round up to the next month applies under the new system as well or just the old system.)

If you’re being laid off, don’t forget the statutory notice period. If they want to skip it, they need to give you payment in lieu of notice (whatever you were supposed to earn in that period), and for tax purposes it’s counted as part of the severance pay i.e. tax free. :slight_smile:

how new is the new pension system? also, does it have to be one full year? what if a school lays off a teacher after one school year (Sept. - June) which is about 10 months? then are they off the hook for paying severance?

Iirc, Regular school teacher may be under a different pension system.

Buxiban teacher without a taiwanese spouse might not be a subject of the new pension system.

Eta: foreign buxiban teachers are professional workers, so subject to the new system.

It doesn’t need to be a full year. For example, under the old system, if your service period i.e. your seniority (年資) is 5 months plus 1 day, it gets rounded up to 6 months, which means your severance pay should equal 0.5 months. It keeps rounding up to the next month i.e. the next 1/12 of a month in terms of payment, so 6 months plus 1 day would give you 7/12 of a month’s salary.

(If you’re part-time, you may be subject to the 60% rule. I don’t quite remember how that goes, but the idea is to give you slightly more than you would otherwise get because the amount is going to be very low anyway.)

The new system is not new per se (2005?), but it’s relatively new for permanent residents (other than foreign spouses, who have been subject to it for years). If you were a PR when the new system began to apply to PR’s, you should have received a notice from your employer regarding the change and your option to remain in the old system. See the discussion here:

And as Tando noted, whether you’re a buxiban or non-buxiban teacher may also make a difference.

If you’re not sure which system you’re in (or should be in), I suggest contacting the Bureau of Labor Insurance, though they don’t always get things right.

so I got a consultation at the labor office today and they informed me that workers under fixed length contracts do not get severance, even if their contract is terminated with little or no notice. he said that one must have a non-fixed term work contract in order to be able to claim severance. Is this true as far as you know? any way for fixed term contract workers to get severance?

If the contract is completed, of course there’s no severance.

If it’s terminated (for a valid reason) before completion under Art. 11 or Art. 14 of the LSA, severance pay applies.

The way it works:

  1. Art. 11 (no-fault termination by employer) ==> Art. 16 (notice period or pay in lieu of notice) ==> Art. 17 (severance pay)

  2. Art. 14 (termination by employee in response to violation) ==> Art. 17 (severance pay)

The person you spoke with was thinking of Art. 18:

Official translation:

If your contractually agreed termination date is 2019-06-30, and you’re given notice on 2019-06-01 – or on any date, for that matter – that the contract will in fact terminate on 2019-06-30, that means the contract will be completed, so it will not be terminated early. Ergo, no severance.

If you’re given notice on 2019-06-01 that your contract will terminate on 2019-06-11, that means you’re being laid off in accordance with Art. 11 (assuming there’s a valid Art. 11 reason for the termination), so severance pay applies, even though the time left in the contract is rather short.

For any other interpretation, I would ask for a judicial or administrative citation that can be looked up.