Pay large sum upon contract termination?

I may contract with a school today.

One article in the contract surprised me.

In particular, if the teacher (for any reason) terminates the contract at any date prior to the contract’s end, then the teacher must compensate the school NT$30,000.

This is actually a rather large sum of money. And in some unforeseen event that I had to terminate the contract, I’m not even sure I would be able to pay it.

Of course I would like things to go well and continue on through the whole year of the contract. But this is my first time living in Taiwan (not my first time teaching in Asia), and it would be my first time teaching with this particular school.


Is this sort of condition normal?

There are literally hundreds of posts on the same subject but if I remember correctly the answer is that this is an illegal clause. But it depends how much you want the job. Schools hold the cards, you don’t want to sign? No worries we have another dozen who will.

It’s against Council of Labour Affair’s (CLA) rules for employers to take any money from your paycheck in this way. It is not against the law for the clause to be contained in the contract. If you sign the contract then you are agreeing to pay 30,000NTD should you fail to complete the contract.

If you quit before completing the contract then the school will almost certainly withhold 30k from your final salary check. This is illegal. What they should do is pay you the money owed and then take you to court for breach of contract. At this point you simply need to contact the CLA and they will make the school pay you what is owed. The school can then decide whether to take you to court or not.

I suppose the decent thing to do is refuse to sign the contract unless the clause is removed. However, then you won’t get the job. It’s a bit of a catch 22 situation really. You’re going to have to get used to this sort of nonsense in Taiwan.

One further point. Any school that has clauses such as this in its contracts is guaranteed to be shit. I would bet money that there’s also something in there about it being illegal for you to work for any other employer.

My understanding from reading the posts and the relevant material from the government on the issue is that it is legal, but they cannot deduct the penalty from your salary – they must ask you to pay it and if you don’t they can sue you. Most employers ignore the laws, however, and just deduct it from your salary or just not pay you whatever they owe you.

In my experience, employers that have this clause in their contract need to blackmail employees to keep them for a year. Do you really want to work at that kind of place?

My understanding is there penalties are illegal.
If you want the job sign the contract, and when you decide to leave, leave on pay day. Eat the 5 days if they pay you on the 5th, better yet work a weekend in so it is 3 days dinner. Fighting and the CLA are not worth the effort.

[quote=“bigduke6”]My understanding is there penalties are illegal.
If you want the job sign the contract, and when you decide to leave, leave on pay day. Eat the 5 days if they pay you on the 5th, better yet work a weekend in so it is 3 days dinner. Fighting and the CLA are not worth the effort.[/quote]

Many employers hold back two weeks pay to cover such an eventuality. Again, against the rules.