Newsletter
NEW INTERPRETATION RE-GARDING OLD PENSION SYS-TEM
To dispel differing interpretations by businesses of what constitutes "adequate payments" into a company's pension fund account under the old pension system, as required under the new Labor Pensions Act, the Council of Labor Affairs (CLA)has made freely available on its website software for calculating the level of payments needed to make adequate provision for future retirement payments.
According to CLA estimates, although 90% of Taiwan's approximately 530,000 enterprises have thus far made no payments into the pension retirement fund account, all of its large compa-nies have done so. In other words, of the 6 mil-lion workers throughout Taiwan who are subject to the provisions of the Labor Standards Act, only 44% (around 2.64 million people) currently have no pension provision. Based on the current average monthly salary per worker of NT$35,341, as calculated by the Director-ate-General of Budget, Accounting and Statistics, and average employment to date of 6.7 years for workers in small and medium-sized enterprises, companies that have so far made no provision at all will need to pay an average of some NT$40,000 per worker into the pension fund account within five years. This adds up to a total of around NT$105.63 billion, and not the astro-nomical figure of NT$2.6 trillion initially esti-mated by some in the business community.