Several questions for several friends, all employed in one company. Maybe someone has some insight or ideas that could help. They plan to get legal counsel, maybe someone can recommend a lawyer that specializes in such topics and speaks excellent English (or German)?
First of all, if an work ARC holder is in the old system (LSA) and marries a local, is it correct that he must change to the new system (LPA) because “foreign spouses are mandatory pension contributors”. I suspect this is wrong, and instead the worker may choose to stay in the old system: https://www.bli.gov.tw/en/0010369.html Number 4 states that “If this kind of workers desire to continue to abide by [the old labor pension system], he/she shall express such a desire to the business entity in writing […] within 6 months after his/her acquisition of said status.”
The second topic is: An employer wants all workers to change to a different company of the same parent company. Some employees are APRC holders (work based) with ~20 years of work seniority in their company. Currently they are still in the old system (LSA), the employer has put aside quite a bit of money for their pension/severance according to that system. They are offering everyone to either enter the new company (keeping their work seniority), or leave and get severance pay. Generally, they want everyone to transfer to the new company.
Is the following understanding correct?
The employees that transfer to the new company must switch to the new system (LPA) because of entering a new contract at a new legal entity
The money put aside for their pension/severance according to the old system (LSA) will simply be pocketed by the employer
Even if calculating with the same work seniority, both their pension and severance seem very much lower with the new system compared to the old one. Also, according to the new system they can only retire (get pension payments) after they turn 60, instead of after 25 years at the same employer with the old system.
There is no way for the employee to both keep working at the new company, and keep their old system pension (or at least get their old system severance and then work at the new company).
For the “new company” part, there’s at least one Supreme Court case stating that when a company changes in nominal terms (new registration) but not in practical terms (same people etc.), it’s the same entity in terms of its obligations as an employer. I can find the citation if you want.
The fact that the employer is offering continuity of seniority indicates that the new company sees itself as a continuation of the old company, in employment terms. So if it argues at the same time that the employees who keep their seniority need to switch to the new pension system, that appears to be a contradiction.
Either way, please keep us updated about this case.
Thanks a lot for these comments. The reasoning of the company seems to be “the government requires to change to the new system, we can’t stay at the old one even if we wanted to”. Maybe knowing this case reference could help, if it’s not too much trouble it would be much appreciated.
Looks like BS. Because government typically requires something based on some grounds. Which one? Good question…
IMHO, they (the company) are very interested to “save” some money. At least the future contributions. But maybe not only. Here I would suggest to ask them just one question: What will happen with the already accumulated “reserved fund” ? If they are absolutely honest they should transfer all the accumulated money to the newly created personal employee accounts (new system).
Weird, because we work for the government of ROC and they gave us a choice: stay in the old system or change. Most people who were closer to retirement chose stay.
I was given a choice early last year because my company claimed the govt was making everyone choose by the middle of the year if they wanted to remain in the old system. To do so, you had to provide a letter requesting it. Because I’m stupid and couldn’t figure out which was better for me, I moved to the new system. I think it was a mistake.
A friend has a “situation” at work and needs some legal advice. She’s close to retirement using the old system. Now the employer suggests a settlement before she reaches the time when she’s entitled to pension payment. They want her then continue working for the company using the new system. The amount suggested in the settlement is calculated based on the salary of the last six months. Because of the Covid situation, she’s been working less over that period, so the salary came down a bit. This makes a huge difference, though. I estimate NT$400,000 less than compared to the sum based on the salary she had just half a year earlier.
So here are my questions.
Has anyone here done a settlement like this?
I think there was a deadline for switching from the old to the new system (can’t remember when that was). So is the above proposition even possible? Can she switch to the new system like that?
Is the money she would receive in the settlement tied to the new system? Like, she can only get her hands on the money after reaching 60 years of age?
Is there a legal service somewhere she could consult just to get some clarification on those laws?
Iirc the deadline to switch was the same year the new system was expanded to PR’s.
If it’s a proper settlement in accordance with the Civil Code, she can ask for any amount she wants, higher or lower than what she’s otherwise entitled to. The parties agree to extinguish a claim in exchange for something else.
Short consultations with free lawyers are available at the labor department on certain days at certain times (she should go to the one in the city/county where she works) and at Taipei City Hall, plus the Legal Aid Foundation.
She can also try asking the Bureau of Labor Insurance for advice, but in my experience they’re not terribly helpful.
Wasn’t sure whether to start a new thread, let’s try this here for now.
The law (specifically, the “Act for the Recruitment and Employment of Foreign Professionals”) changed again, effective 1/1/26. One of the changes opens up the New Labor Pension System to all foreign professionals (it was opened to foreign spouses in 2014 and then to APRC holders in 2018). Each time the relevant law has changed, people who were still covered by the “old” system (aka, under the Labor Standards Act) were given 6 months to choose whether to remain in the old system or switch to the New, and so also this time. So far, so good.
A friend of mine is in an unusual bind. He has been with his current employer since 2021 and as a holder of a work-based ARC he’s been under the old/LSA retirement system. He happened to get his APRC last November, before the latest changes took effect. Now, for people who were with their current employer before the last round of changes in 2019 and who got their APRC last year, they had the 6-month window to choose (and, for those whose 6-month window extended past 1/01/26, it was automatically extended to 6/30/26). But, because he started his current job in 2021, and got his APRC before the latest changes took effect, the Bureau of Labor Insurance now says he never had a choice, that he was automatically switched to the New Labor Pension System effective from the date he got his APRC in November 2025.
Mainly I’m wondering whether anyone on here is in this situation, or knows someone who is; he can’t be the only person who started his current job after 2019 and got his APRC late last year. He’s currently appealing to the BLI for some interpretation of the law that will let him stay under the old system (which under his current employer, is substantially better for him); it might be helpful if there were others joining his appeal in a sort of class action or whatever.
Beyond that, looking for legal insight, as I suspect the BLI will reject his appeal, I’m curious whether filing some kind of more formal legal appeal has any potential or not. [Yeah I know, talk to an actual lawyer – just looking for thoughts before he gets to that, as there are a few people on here who appear to understand these things … and my friend will have to consider whether the difference in the two systems is worth the cost of a lawyer, etc.] Thank you for your attention to this matter.