Resignation before fixed term contract ends?

I was wondering if you can leave a three year fixed term employment contract early, what is the notice period, and whether the employer can demand some sort of compensation?

A friend signed a three year fixed term contract, and after several months wants to leave as things are not working out. I’m trying to work out if he can leave without any financial repercussions and what notice he must give. The only reference to notice I’ve found refers to ongoing contracts. There is nothing in the contract itself regarding resignation.

Thank you for any information.

[quote=“Boony”]I was wondering if you can leave a three year fixed term employment contract early, what is the notice period, and whether the employer can demand some sort of compensation?

A friend signed a three year fixed term contract, and after several months wants to leave as things are not working out. I’m trying to work out if he can leave without any financial repercussions and what notice he must give. The only reference to notice I’ve found refers to ongoing contracts. There is nothing in the contract itself regarding resignation.

Thank you for any information.[/quote]
Ideally, both parties agree on a termination date and put it in writing.

If the employee resigns improperly, the employer can claim compensation (Civil Code Art. 489) but only by suing the employee. The amount of compensation is determined by a court unless both parties reach a settlement. The salary for every day worked still needs to be paid on time. If the contract is deemed not to have been terminated, the (foreign) employee risks getting in trouble with the government for being absent without leave for three consecutive days. :no-no:

If it’s a typical employer, consider quitting on the basis of the employer having committed one or more violations (Labor Standards Act Art. 14), so the employee is absolved of responsibility and entitled to tax-free severance pay, one month’s salary per year of service, pro-rated by months rounding up (unless married to a Taiwanese, then just 1/2 month’s salary per year). Just make sure there’s proof.

Lots of confusing information here:
law.moj.gov.tw (some content also available in English)
laws.mol.gov.tw (some content also available in English)

You can also ask for advice and consult a lawyer for free at the labor department. If you can’t because it conflicts with your work schedule, you may be able to schedule an appointment at a suitable time with the Legal Aid Foundation (www.laf.org.tw).

Taipei City Hall also provides legal advice on the ground floor (separately from the labor department), but without interpreters afaik.

Thanks for that. I’ve seen suggestions to visit the labour department, if need be I might send him but could be language issues (doesn’t speak Chinese or English really). From what he’s told me and from reading his contract there could be multiple examples of employer violations but I think the first step is to try and get something resolved on an amical basis.

I found something interesting on anotehr thread “In addition, foreigners’ salary must be at least 48k a month”. Is this true? Where is there info on that as my friend is nowhere near that despite working +65hrs per week. (Note: edited from 65hrs per month to 65hrs per week)

There should be no penalty for leaving a job before the end of the contract unless your friend agreed to an early termination penalty in the contract. If your friend didn’t then all he needs to do is give appropriate notice. Ask the MOL what is considered appropriate notice.

Don’t plan on using yyy’s advice of labor violations as basis to quit. The MOL isn’t going to back an employee termination without mediating and allowing the employer to fix these labor violations. This is something that will drag out for months unless there is a MAJOR violation.

Your friend should meet with the MOL and find out exactly what labor violations are being committed. I potentially see two big ones in addition to the typical smaller ones but you need to clarify something. I am assuming that your friend is working 65 hrs/wk and not 65 hrs/month.

Thanks for noting I just amended.

There is nothing in the contract about the resignation process. I also don’t plan on using any labour violations as a reason for him to resign as I think he just wants to keep it amicable and not stir the pot. If need be I’ll go to the MOL when I’m there next month.

Thanks for your help!

If that is the case then your friend should specifically ask the MOL about the minimum pay and what the company is claiming that he makes. They might be claiming and reporting 48k/mo to the tax office but paying him less. That is a major violation. In addition it should also say a monthly salary in the contract. This is something that could result in a significant settlement between them and it could be grounds for immediate termination of the contract.

the overtime (65hrs/wk) is also a violation but your friend is going to need to be able to explicitly prove that he was required to work those hours because the company will just play dumb. For example ‘we have no idea why he was working so many hours - that isn’t our company policy’ or something similar.

[quote=“Abacus”]There should be no penalty for leaving a job before the end of the contract unless your friend agreed to an early termination penalty in the contract. If your friend didn’t then all he needs to do is give appropriate notice. Ask the MOL what is considered appropriate notice.

Don’t plan on using yyy’s advice of labor violations as basis to quit. The MOL isn’t going to back an employee termination without mediating and allowing the employer to fix these labor violations. This is something that will drag out for months unless there is a MAJOR violation.

Your friend should meet with the MOL and find out exactly what labor violations are being committed. I potentially see two big ones in addition to the typical smaller ones but you need to clarify something. I am assuming that your friend is working 65 hrs/wk and not 65 hrs/month.[/quote]
The Civil Code doesn’t say they need to have agreed on a penalty in advance. Realistically, I don’t think it’s likely to happen if the employer didn’t bother putting a penalty in the contract, but it’s not impossible.

The Labor Standards Act actually makes it very easy to quit blamelessly when the employer is breaking the law.

[quote=“LSA Art. 14”]A worker may terminate a labor contract without giving advance notice to the employer in any of the following situations:

  1. Where an employer misrepresents any fact at the time of signing a labor contract in a manner which might mislead his/her worker and thus caused him/her to sustain damage therefrom.
  2. Where an employer, his/her family member or his/ her agent commits violence or grossly insults the worker.
  3. Where the work specified in a labor contract is likely to be injurious to the worker’s health and the worker has requested his/her employer to improve working conditions but all in vain.
  4. Where an employer, an agent of the employer or a fellow worker contracts a harmful, contagious disease and there is a possibility that the worker may contract this disease.
  5. Where an employer fails to pay for work in accordance with the labor contract or to give sufficient work to a worker who is paid on a piecework basis.
  6. Where an employer breaches a labor contract or violates any labor statute or administrative regulation in a manner likely to adversely affect the rights and interests of the particular worker.
    Where a worker intends to terminate a labor contract pursuant to Subparagraphs 1 or 6 of the preceding paragraph, he/she shall do so within thirty days from the date he/she becomes aware of the particular situation.
    Where there exist any of the situations set forth in Subparagraph 2 or 4 of the Paragraph 1 to this article, and the employer has already discharged the agent concerned or has hospitalized or discharged the person suffering from such harmful, contagious disease, the worker may not terminate the labor contract.
    The provisions of Article 17 shall apply, mutatis mutandis, to the termination of labor contract pursuant to this article.
    有左列情形之一者,勞工得不經預告終止契約:
    一、雇主於訂立勞動契約時為虛偽之意思表示,使勞工誤信而有受損害之虞者。
    二、雇主、雇主家屬、雇主代理人對於勞工,實施暴行或有重大侮辱之行為者。
    三、契約所訂之工作,對於勞工健康有危害之虞,經通知雇主改善而無效果者。
    四、雇主、雇主代理人或其他勞工患有惡性傳染病,有傳染之虞者。
    五、雇主不依勞動契約給付工作報酬,或對於按件計酬之勞工不供給充分之工作者。
    六、雇主違反勞動契約或勞工法令,致有損害勞工權益之虞者。
    勞工依前項第一款、第六款規定終止契約者,應自知悉其情形之日起,三十日內為之。
    有第一項第二款或第四款情形,雇主已將該代理人解僱或已將患有惡性傳染病者送醫或解僱,勞工不得終止契約。
    第十七條規定於本條終止契約準用之。[/quote]
    You just need to be certain you have sufficient evidence of a valid reason. If it’s Subpar. 1, 5, or 6 (and it’s usually one or all of those), there’s no requirement to give the employer time to fix it. There is a 30 day limit for 1 and 6, but there’s no advance notice period for this type of termination. Dragging on for months and months is possible if the employer refuses to give severance pay, and you care enough to pursue it, or the employer wants revenge and therefore refuses to recognize the termination of the contract.

If planning to go down this road, make sure the Labor Standards Act is applicable (there are still some jobs that aren’t covered), and make sure there is no Art. 84-1 exemption allowing additional overtime etc. (and if there is, find out whether it was approved by the labor department or not; if it was neither approved nor rejected, it’s not automatically invalid).

Also, even when talking to the government or a lawyer, get multiple opinions. Civil servants, lawyers, and interpreters also make mistakes.

The 48k minimum salary is a common requirement for foreigners in white collar jobs, but it doesn’t apply to everyone. Buxiban teachers, for example, are not subject to the 48k minimum. If there’s no such requirement, the basic (minimum) wage for most people is currently $20,008/m for 40h/w, or $120/h. (See also the recent thread about how to calculate overtime pay.)

[quote=“yyy”]
You just need to be certain you have sufficient evidence of a valid reason. If it’s Subpar. 1, 5, or 6 (and it’s usually one or all of those), there’s no requirement to give the employer time to fix it. There is a 30 day limit for 1 and 6, but there’s no advance notice period for this type of termination. Dragging on for months and months is possible if the employer refuses to give severance pay, and you care enough to pursue it, or the employer wants revenge and therefore refuses to recognize the termination of the contract.

If planning to go down this road, make sure the Labor Standards Act is applicable (there are still some jobs that aren’t covered), and make sure there is no Art. 84-1 exemption allowing additional overtime etc. (and if there is, find out whether it was approved by the labor department or not; if it was neither approved nor rejected, it’s not automatically invalid).

Also, even when talking to the government or a lawyer, get multiple opinions. Civil servants, lawyers, and interpreters also make mistakes.[/quote]

The MOL is not going to terminate a contract and award severance to an employee with giving them a warning about the infractions and an opportunity to improve the conditions.

Where is it written that the employee must not take the initiative to terminate his own contract? That would be quite the nanny state…

Where is it written that the employee must not take the initiative to terminate his own contract? That would be quite the nanny state…[/quote]

The employee can terminate his own contract but he isn’t going to be able to immediately terminate and get severance because of a couple of minor labor law violations that the company wasn’t aware of (they were but they will deny).

Where is it written that the employee must not take the initiative to terminate his own contract? That would be quite the nanny state…[/quote]

The employee can terminate his own contract but he isn’t going to be able to immediately terminate and get severance because of a couple of minor labor law violations that the company wasn’t aware of (they were but they will deny).[/quote]
Severance pay is due within 30 days of termination, after which interest begins to accumulate, plus the minimum fine of $300,000. The employer can delay an inspection by requesting mediation and hoping for a settlement (to evade the penalty, because the employee wouldn’t be permitted to take administrative or legal action arising from the same dispute after a settlement), but there’s no need for the employee to settle, and mediation doesn’t extend the deadline for severance pay if the termination has already occurred.

We are not even talking about the same thing. If you quit like the OP wants to you get no severance. Correct me if I am wrong about that.

If you file a complaint that the company has a couple of minor labor law violations then the MOL is going to give the company a chance to correct these issues. They don’t immediately jump to immediate contract termination and severance pay.

[quote=“Abacus”]We are not even talking about the same thing. If you quit like the OP wants to you get no severance. Correct me if I am wrong about that.

If you file a complaint that the company has a couple of minor labor law violations then the MOL is going to give the company a chance to correct these issues. They don’t immediately jump to immediate contract termination and severance pay.[/quote]
Iirc the question was about whether or not the employee can get in trouble for quitting when the contract has a fixed term and no clause to allow the employee to quit, and the period of service does not exceed three years. My point is that if the employee quits by performing an Art. 14 termination, he can’t get in trouble (unless the company reports him for being awol, but in the end he will prevail as long as he can prove the termination was valid).

If you want to quit using Art. 14, you don’t do it by filing a complaint. You do it by quitting (giving the employer immediate notice of the fact that you’re quitting and your reason(s) for doing so). If the employer refuses to co-operate, then you file a complaint, and in the end it will be affirmed that the contract was terminated on the day you terminated it. If you don’t want severance pay, you don’t need to pursue it.

What kind of work do you do yyy?

It sounds like you have some knowledge on the topic, but it would be good to know that it comes from practical experience besides knowing the content of the laws. :slight_smile:

[quote=“Ricarte”]What kind of work do you do yyy?

It sounds like you have some knowledge on the topic, but it would be good to know that it comes from practical experience besides knowing the content of the laws. :slight_smile:[/quote]
Some of it comes from practical experience, through which I have had discussions with quite a few lawyers and civil servants. The rest is from reading a variety of sources, official and unofficial.

[quote=“yyy”][quote=“Abacus”]We are not even talking about the same thing. If you quit like the OP wants to you get no severance. Correct me if I am wrong about that.

If you file a complaint that the company has a couple of minor labor law violations then the MOL is going to give the company a chance to correct these issues. They don’t immediately jump to immediate contract termination and severance pay.[/quote]
Iirc the question was about whether or not the employee can get in trouble for quitting when the contract has a fixed term and no clause to allow the employee to quit, and the period of service does not exceed three years. My point is that if the employee quits by performing an Art. 14 termination, he can’t get in trouble (unless the company reports him for being awol, but in the end he will prevail as long as he can prove the termination was valid).

If you want to quit using Art. 14, you don’t do it by filing a complaint. You do it by quitting (giving the employer immediate notice of the fact that you’re quitting and your reason(s) for doing so). If the employer refuses to co-operate, then you file a complaint, and in the end it will be affirmed that the contract was terminated on the day you terminated it. If you don’t want severance pay, you don’t need to pursue it.[/quote]

Please answer the question. Does an employee that quits (his choice) get severance pay?

[quote=“Abacus”][quote=“yyy”][quote=“Abacus”]We are not even talking about the same thing. If you quit like the OP wants to you get no severance. Correct me if I am wrong about that.

If you file a complaint that the company has a couple of minor labor law violations then the MOL is going to give the company a chance to correct these issues. They don’t immediately jump to immediate contract termination and severance pay.[/quote]
Iirc the question was about whether or not the employee can get in trouble for quitting when the contract has a fixed term and no clause to allow the employee to quit, and the period of service does not exceed three years. My point is that if the employee quits by performing an Art. 14 termination, he can’t get in trouble (unless the company reports him for being awol, but in the end he will prevail as long as he can prove the termination was valid).

If you want to quit using Art. 14, you don’t do it by filing a complaint. You do it by quitting (giving the employer immediate notice of the fact that you’re quitting and your reason(s) for doing so). If the employer refuses to co-operate, then you file a complaint, and in the end it will be affirmed that the contract was terminated on the day you terminated it. If you don’t want severance pay, you don’t need to pursue it.[/quote]

Please answer the question. Does an employee that quits (his choice) get severance pay?[/quote]
Technical answer: If the LSA applies, and the employee’s termination of the contract is in conformity with Art. 14 (i.e. the employee serves appropriate notice to the employer that the termination is occurring due to the existence of one of the situations listed in Art. 14 Par. 1, and the situation truly does exist, Subpar. 1 and 6 being subject to the proviso of Par. 2 and Subpar. 2 and 4 being subject to the proviso of Par. 3), then Par. 4 makes Art. 17 applicable mutatis mutandis, which means the employer must pay severance pay (and if the employee is Taiwanese or married to a Taiwanese, the Labor Pension Act’s “new system” may apply instead, which is basically 50% of the LSA severance pay).

Easy answer: If your boss screws you, you can quit and get severance pay, though not all types of screwing are equally valid.

Clear enough? :slight_smile:

[quote=“yyy”]
Technical answer: If the LSA applies, and the employee’s termination of the contract is in conformity with Art. 14 (i.e. the employee serves appropriate notice to the employer that the termination is occurring due to the existence of one of the situations listed in Art. 14 Par. 1, and the situation truly does exist, Subpar. 1 and 6 being subject to the proviso of Par. 2 and Subpar. 2 and 4 being subject to the proviso of Par. 3), then Par. 4 makes Art. 17 applicable mutatis mutandis, which means the employer must pay severance pay (and if the employee is Taiwanese or married to a Taiwanese, the Labor Pension Act’s “new system” may apply instead, which is basically 50% of the LSA severance pay).

Easy answer: If your boss screws you, you can quit and get severance pay, though not all types of screwing are equally valid.

Clear enough? :slight_smile:[/quote]

I am glad that we are in agreement that a minor labor law infraction can’t immediately terminate a contract.

[quote=“Abacus”][quote=“yyy”]
Technical answer: If the LSA applies, and the employee’s termination of the contract is in conformity with Art. 14 (i.e. the employee serves appropriate notice to the employer that the termination is occurring due to the existence of one of the situations listed in Art. 14 Par. 1, and the situation truly does exist, Subpar. 1 and 6 being subject to the proviso of Par. 2 and Subpar. 2 and 4 being subject to the proviso of Par. 3), then Par. 4 makes Art. 17 applicable mutatis mutandis, which means the employer must pay severance pay (and if the employee is Taiwanese or married to a Taiwanese, the Labor Pension Act’s “new system” may apply instead, which is basically 50% of the LSA severance pay).

Easy answer: If your boss screws you, you can quit and get severance pay, though not all types of screwing are equally valid.

Clear enough? :slight_smile:[/quote]

I am glad that we are in agreement that a minor labor law infraction can’t immediately terminate a contract.[/quote]
I didn’t say that. For the employer to use Art. 12 on the basis of a violation, it needs to be a major violation (“違反勞動契約或工作規則,情節重大者”). For the employee to use Art. 14 on the basis of a violation, there’s no “major” proviso. All that’s needed is a situation in which “雇主違反勞動契約或勞工法令,致有損害勞工權益之虞者” lit. “the employer violates the labor contract or labor laws/regulations, resulting in fear of harm to the worker’s rights and interests”. I have dealt with this in real life, and the labor department upheld the employee’s use of Art. 14 on the basis of proof that the employer violated the LSA, though there was no need to ask the department to confirm the violations in advance.

With Subpar. 6, there is no need for the employee to give the employer a chance to rectify the situation (unlike Subpar. 3, health & safety issues), though there is a 30 day time limit from the day the employee becomes aware of the situation.

If the employer underpays the employee (Subpar. 5), there is no time limit. (It stands to reason that underpayment ceases to be a valid reason once the debt is cleared.)

I don’t know of any case in which a court deemed a violation too small to make Art. 14 applicable. If you know of such a case, please share.