History

Title:
Labor Pension Act ( 2019.05.15 Modified )Ch
No. Date Law Name
1. 2004.06.30 Labor Pension Act
2. 2007.07.04 Labor Pension Act
3. 2014.01.15 Labor Pension Act
4. 2015.07.01 Labor Pension Act
5. 2016.11.16 Labor Pension Act

  Chapter Ⅰ General Provisions

Article 1
The Act is enacted to protect workers' livelihood after retirement, strengthen the relations between workers and employers, and promote social and economic developments.
The Act takes precedent than other statutes with respect to labor pensions. Matters that they are not provided herein shall be governed by other statutes.
Article 2
The term “competent authority” referred to in the Act shall be the Council of Labor Affairs, Executive Yuan at the central level, the municipal government at the municipal level, and county(city) government at the county(city) level.
Article 3
The terms “worker”, “employer”, “business entity”, “labor contract”, “wage” and “average wage” referred to in the Act shall be defined in accordance with Article 2 of the Labor Standards Act.
Article 4
The Central Competent Authority shall establish the Labor Pension Fund Supervisory Committee (here-in-after referred to as the Supervisory Committee) to review, supervise and audit the Labor Pension Fund (here-in-after referred to as the Fund), and to implement the annuity insurance scheme referred to in the Act.
The Supervisory Committee shall exercise its authority independently, and its organization, meeting and other related matters shall be prescribed by other statutes.
After the establishment of the Supervisory Committee, the administration of the Labor Retirement Fund established in accordance with Paragraph 2 to Article 56 of the Labor Standards Act shall be generally coordinated and handled by the Supervisory Committee.
Article 5
The Central Competent Authority shall entrust the Bureau of Labor Insurance (here-in-after referred to as the Bureau) to take charge of the revenues, expenditures and safeguard of the labor pension, the imposition of late payment charges, and the compulsory execution thereof.
Article 6
Employers shall on a monthly basis contribute labor pension to individual accounts of labor pension at the Bureau for employees applicable to the Act.
Unless otherwise provided for in the Act, an employer shall not create his/her own labor pension mechanism to replace the labor pension system prescribed in the preceding paragraph.

  Chapter Ⅱ Application and Linkage of the Pension System

Article 7
The Act applies to local employees who are also applicable to the Labor Standards Act, but not including those employees whose pension funds shall be appropriate in accordance with the Private School Act.
Employers who actually perform work, and local workers not applicable to the Labor Standards Act and commissioned managers who have obtained their employers' consent to contribute labor pension, may voluntarily make their contributions and claim for payments in accordance with the Act.
Article 8
Employees, who were covered by the Labor Standards Act prior to the enforcement of the Act and still work for the same business entity after the enforcement of the Act, may choose to be continuously applicable to the retirement mechanism in the Labor Standards Act;provided, however, that if they resign from their current jobs and are re-employed, they shall be subject to the pension system of the Act.
A civil servant also with employee status, who continues working at a business entity that was formerly a public-owned but has been privatized after the enforcement of the Act, may choose the retirement mechanism prescribed in the Labor Standards Act or the pension system of the Act.
Article 9
Within the period from the promulgation of the Act to one day prior to the enforcement of the Act, employers shall inquire in writing their employees about their options between the pension system of the Act or retirement mechanism in the Labor Standards Act; employees who have not made a firm option after the expiration of prescribed period shall continuously be applicable to the retirement mechanism in the Labor Standards Act on the date of enforcement of the Act.
Employees, who continuously choose to be applicable to the retirement mechanism in the Labor Standards Act on the date of enforcement of the Act, may within five years choose to be applicable to the pension system in the Act.
Employers shall in accordance with the following provisions file the application for contribution to the Bureau for employees applicable to the pension system in the Act:
1. For those who choose to be applicable in accordance with Paragraph 1, the application shall be filed within 15 days after the enforcement of the Act.
2. For those who choose to be applicable in accordance with Paragraph 1, the application shall be filed within 15 days on the date of their choice.
3. For business entities that are newly established after the enforcement of the Act, the application shall be filed within 15 days on the date of their establishment.
Article 10
When employees are applicable to the pension system in the Act, they shall no longer choose to be applicable to the retirement mechanism in the Labor Standards Act.
Article 11
Employees, who were covered by the Labor Standards Act prior to the enforcement of the Act, still work for the same business entity after the enforcement of the Act and choose to be applicable to the pension system in the Act, their seniority prior to their application to the Act shall be reserved.
When the labor contract is terminated in accordance with Article 11, the proviso of Article 13, Article 14, Article 20, Article 53 and Article 54 of the Labor Standards Act or Article 23 and Article 24 of the Protection for workers Incurring Occupational Accidents Act, an employer shall in accordance with the foresaid statutes use the average wage at the time of terminating labor contract to calculate the severance or retirement payment for the reserved seniority referred to in the preceding paragraph, and the severance or retirement payment shall be paid within 30 days after the termination of labor contract.
During the continuing period of a labor contract, when an employer and an employee mutually agree to pay off the employee’s reserved seniority referred to in Paragraph 1 with a criterion no less than the payment criteria prescribed by Article 55 or Article 84-2 of the Labor Standards Act, and such an agreement shall be complied.
A civil servant also with employee status shall on the date of privatization claim retirement payments for their seniority prior to the privatization in accordance with relevant statutes and regulations applicable to retirement prior to the privatization. However, the remaining civil servants shall suspend their monthly pension payments and related rights until they leave the privatized enterprise.
Article 12
When employees are applicable to the pension system in the Act, and when the labor contract is terminated in accordance with Article 11, the proviso of Article 13, Article 14 and Article 20 of the Labor Standards Act or Article 23 and Article 24 of Act for Workers Protection of Occupational Accidents, an employer shall calculate the severance for the seniority after being applicable to the Act by the criterion that each full year of service shall be paid one half month of average wage and less than one full year of service paid in proportion; the foresaid severance shall not be paid more than six months of average wage, and the criterion of calculation shall not be applicable to Article 17 of the Labor Standards Act.
The severance calculated in accordance with the preceding paragraph shall be paid within 30 days after the termination of labor contract.
When employees choose to be continuously applicable to the retirement mechanism in the Labor Standards Act, their severance shall be paid in accordance with Article 17 of the Labor Standards Act.
Article 13
For protecting employees' retirement payment, employers shall precisely calculate the appropriation rate of labor retirement reserve fund in accordance with such factors as the number, wages, seniority and turnover rate of those employees who are applicable to the retirement mechanism in the Labor Standards Act and reserve their seniority prior to the application of the Act, and shall continuously appropriate labor retirement reserve fund sufficiently each month in accordance with Paragraph 1 to Article 56 of the Labor Standards Act for five years to pay for employees' retirement payment.
When an employer and an employee agree to pay off the retirement payment in accordance with Paragraph 3 to Article 11, it may be paid from the labor retirement reserve fund account established in accordance with Paragraph 1 to Article 56 of the Labor Standards Act.
The retirement payments that shall be given to employees in accordance with Paragraph 4 to Article 11 shall be handled pursuant to Article 9 of the Act of Privatization of Government-Owned Enterprises.

  Chapter Ⅲ Contribution and Claim for Individual Account of Labor Pension

Article 14
The contribution rate by an employer to the labor pension per month shall not be less than six percent of employee's monthly wage.
The Table of Monthly Contribution Wage Classification referred to in the preceding paragraph shall be prescribed by the Central Competent Authority and submitted to the Executive Yuan for approval.
An employee may also voluntarily contribute labor pension within six percent of his/her monthly wage. The full amount of labor pension voluntarily contributed by an employee may be deducted from the his/her gross consolidated income of the year.
The preceding three paragraphs shall be applicable to those persons who voluntarily contribute to their labor pension in accordance with Paragraph 2 to Article 7.
Article 15
When a person hired by the same employer or who voluntarily contributes labor pension in accordance with Paragraph 2 to Article 7 or Paragraph 3 to Article 14 may adjust his/her contribution rate in one year but limited to two times. Upon the adjustment, the employer shall fill out a contribution rate adjustment form and submit to the Bureau prior to the end of the month that the adjustment is made, and the adjustment shall become effective on the first day of the month following the submission.
When the adjustment of a person's monthly wage is made between February to July of the current year, its employer or business entity affiliated shall notify the Bureau the monthly contribution wage after adjustment by the end of August of the current year; when the adjustment is made between August of the current year to January of the following year, the notification to the Bureau shall be made by the end of February of the following year; all the adjustments shall become effective from the first day of the following month after the notification.
The contribution rate referred to in Paragraph 1 shall be counted to the first decimal point of a percentage.
Article 16
An employer shall contribute labor pension for an employee from the first date of employment to the date that the employee resigns; however, if an employee chooses to be applicable to the pension system in the Act since the date of its enforcement, his/her contribution shall be made from the date of choosing to be applicable to the pension system in the Act to the date of resignation.
Article 17
To persons who voluntarily contribute labor pension in accordance with Paragraph 2 to Article 7, their employers or business entities affiliated shall file with the Bureau for commencing or terminating the contribution from the date of voluntary contribution to the date of terminating contribution, and shall deduct, collect and make the contribution on a monthly basis.
To persons who voluntarily contribute labor pension referred to in the preceding paragraph, their contributions shall be made from the filing date of voluntary contribution to the filing date of termination.
Article 18
An employer shall make and file a list with the Bureau within seven days from the date when an employee commences his/her job, resigns, is reinstated, or dies to process the commencement or termination of contribution.
Article 19
The Bureau shall prepare and mail a payment statement listing the amount of labor pension that employer shall contribute and collect to the business entity prior to the 25th day of the following month, and the employer shall make the contribution prior to the end of the month next to the foresaid following month.
To employees who voluntarily contribute labor pension, their voluntarily contributions after collected by their employers shall be made together with the portion contributed by their employers to the Bureau. Their contributions shall be made from the date of voluntary contribution to the date of resignation.
If an employer fails to contribute within a given period or sufficiently, the Bureau shall within a given period notify the employer to contribute.
Article 20
An employer shall apply and report in writing to the Bureau for terminating the contribution to the pension within seven days from the date when an employee is on leave without pay, serving in military, suspended from duties because of lawsuit or detained prior to a final judgment of the court. The employer shall apply and report in writing to the Bureau for commencing the contribution when the employee is reinstated.
When an employer is required to make up the wages for a reinstated employee for the period of suspension from duties because of lawsuit or detention, the employer shall make up the contribution to the pension for such period by the end of the month that is two months after the month that the employee was reinstated.
Article 21
An employer shall inform in writing the employees of the amount of contribution made.
An employer shall prepare a name list of employees including such information as the dates of commencement, dates of resignation, record of attendance, wages, monthly contribution record and other related data.
Article 22
A business entity shall not create its own labor pension mechanism to replace the labor pension system prescribed in the Act.
Article 23
The labor pension shall be paid and calculated as follows:
1. For monthly pension payment, the principal and accrued dividends from an employee's individual account of labor pension are paid in fixed installments. The amount of each installment shall be calculated based upon the life chart of annuity, average life expectancy, interest rate and other factors.
2. For lump-sum payment of retirement, the principal and accrued dividends from an employee's individual account of labor pension are claimed in lump sum at one time.
The return rate generated from the utilization of employees' pension contributed in accordance with the Act shall not be less than the interest rate of a two-year fixed term deposit by local banks; in the event of any deficiency, the Treasury shall make up the shortfall.
The terms life chart of annuity, average life expectancy, interest rate and calculation of amount referred to in Subparagraph 1 of Paragraph 1 shall be prescribed by the Bureau and submitted to the Central Competent Authority for approval.
Article 24
An employee who is sixty years or older and whose seniority exceeds fifteen years, shall claim for monthly pension payment. However, an employee whose seniority is less than fifteen years shall claim for lump-sum payment of retirement.
Seniority referred to in the preceding paragraph shall be calculated based upon the period of which the contributions to the pension have been made. If the seniority of an employee is interrupted, both his/her seniority before and after the interruption shall be combined in calculation.
A worker who is not applicable to the Labor Standards Act shall claim for pension only when he/she meets the requirement prescribed in Paragraph 1.
Article 25
When a worker starts to claim for the monthly pension payment, he/she shall pay a one-time premium for annuity insurance to cover his/her annuity benefits if he/she lives beyond the average life expectancy prescribed in Paragraph 3 to Article 23.
The amount of premium, contribution procedures and qualifications of the insurer(s) of annuity insurance referred to in the preceding paragraph shall be prescribed by the Central Competent Authority.
Article 26
If a worker dies before claiming for the pension, his/her survivors or designated person(s) shall claim for the lump-sum payment of retirement.
If a worker, who has received the monthly pension payment, dies before he/she reaches the average life expectancy prescribed in Paragraph 3 to Article 23, the monthly pension payment shall be terminated. The residual amount in his/her individual account of labor pension shall be calculated and paid to his/her survivors or designated person(s).
Article 27
The orders of survivors who may claim for the pension in accordance with the preceding Article are as follows:
1. Spouse and children.
2. Parents.
3. Grandparents.
4. Grandchildren.
5. Siblings.
If there is more than one person in any of the above orders, they shall jointly claim for the pension; otherwise, the one who claims for the pension shall distribute such pension between or among the survivors in the same order. In the event of death, waiver of inheritance, or disqualification of heirs due to legal reasons, the pension shall be claimed by other survivors. However, if a living will is made to designate a claimant for the pension, such a will shall be complied with.
If a deceased worker has no heir or designated claimant referred to in Paragraph 1, the principal and the return accrued in his/her individual account of labor pension shall belong to the Fund.
Article 28
A worker, his/her survivor(s), or his/her designated person(s) shall file and submit an application and relevant documents to the Bureau to claim for the pension; the application procedures and documents required shall be prescribed by the Bureau.
When the application procedures have been completed and if the monthly pension payment is approved, the payment shall be made on a quarterly basis from the month following the receipt of the application; if the lump-sum payment of retirement is approved, the payment shall be made after thirty days from the day of receiving the application.
The basis of calculating the final amount of pension to be claimed by a worker, his/her survivor(s) or his/her designated person(s) shall be prescribed by the Central Competent Authority.
The right to claim for the pension referred to in Paragraph 1 shall be extinguished if such right is not exercised within five years from the date that the pension can be claimed.
Article 29
The pension and the right to claim for the pension shall not be transferred, attached, offset, or mortgaged and guaranteed.
Article 30
An employer shall not deduct the contribution made by him/her from an employee's wage as a compensation or ask an employee to refund the contribution made when the employee resigns. If there is an agreement that an employee shall compensate or refund the contribution made upon resignation, the agreement shall be null and void.
Article 31
When an employer fails to contribute to the pension on monthly basis or in full for an employee in accordance with the Act and causes damages to the employee, the employee shall claim damages from the employer.
The right for an employee to file the claim referred to in the preceding paragraph shall be extinguished if such right is not exercised within five years from the date of resignation.
Article 32
Sources of the Fund are as follows:
1. Pension in employees’ individual accounts.
2. Profits from the utilization of the Fund.
3. Late payment charges.
4. Other revenues.
Article 33
The Fund shall only be used for paying workers’ pensions and investment/utilization, and shall not be attached, mortgaged and guaranteed, or used for other purposes; regulations concerning the management, utilization and profit/loss allocation of the Fund shall be prescribed by the Central Competent Authority and submitted to the Executive Yuan for approval.
The Supervisory Committee may commission financial institutions to manage and utilize the Fund. Regulations concerning the management, scope and expenses of the commissioning shall be prescribed by the Supervisory Committee and submitted to the Central Competent Authority for approval.
Article 34
The Bureau shall establish independent accounts for handling the revenues and expenditures of the labor pension and the Fund, and shall handle them separately from its other businesses; the Bureau shall prepare relevant accounting report and final financial settlement in accordance with related statutes and regulations and submit to the Supervisory Committee for review and approval.
The report concerning revenues, expenditures, utilization and the accumulated amount of the Fund shall be on monthly basis submitted to the Supervisory Committee for review and further submitted by the Supervisory Committee to the Central Competent Authority for record and reference, and the Central Competent Authority shall publicly announce it on yearly basis.

  Chapter Ⅳ Annuity Insurance

Article 35
A business entity with over 200 employees may, with the consent of labor union or with the approval of more than one half of employees when no labor union exists, purchase an annuity insurance pursuant to the Insurance Act instead of contributing labor pension in accordance with Paragraph 1 to Article 6. However, if less than one-half of its employees decide to participate in the annuity insurance, such insurance shall not be implemented.
Regulations concerning revenues, expenditures, approval and other related matters of compliance of the annuity insurance referred to in the preceding paragraph shall be prescribed by the Central Competent Authority. A business entity that purchases the annuity insurance referred to in the preceding paragraph shall file with the Central Competent Authority for approval.
The average return rate of annuity insurance referred to in Paragraph 1 shall not be less than the rate prescribed in Article 23.
Article 36
The contribution rate by an employer to the annuity insurance premium per month shall not be less than six percent of employee’s monthly wage.
The employer shall pay the premium by the end of each month, and the insurer shall inform the Bureau of the situation of premium collection prior to the seventh day of the following month.
Article 37
An employer shall be the proposer of annuity insurance contract, and an employee shall be the insured and the beneficiary. A business entity can only purchase annuity insurance from a single insurer. Qualifications of the insurer shall be jointly prescribed by the Central Competent Authority and the insurance competent authority.
Article 38
When an employee resigns from the current job and is re-employed, the new employer shall be the proposer of the annuity insurance contract of the employee and continue to pay the premium. When the contribution rate to the annuity insurance premium born by the new employer and the ex-employer is not the same, the employee shall be responsible for paying the difference. However, the foresaid provision shall not apply if the new employer is willing to pay the difference.
If the new employer of the employee referred to in the preceding paragraph does not purchase annuity insurance, he/she shall contribute to the labor pension in accordance with Paragraph 1 to Article 6. Unless there is different agreement between the employer and the employee, the employee shall pay the full amount of the premium of the annuity insurance contract; if the employee cannot pay the premium, the continuity of the annuity insurance contract shall be dealt with in accordance with the Insurance Act and the foresaid insurance contract.
When an employee referred to in Paragraph 1 resigns from the current job and is re-employed, he/she may select the pension system that the new employer contributes to the labor pension in accordance with Paragraph 1 to Article 6.
Article 39
Articles 7 to 13, Article 15, Article 16, Article 20, Articles 29 to 31 of the Act shall apply, mutatis mutandis, to the annuity insurance prescribed in the Act.

  Chapter Ⅴ Supervision and Expenses

Article 40
The competent authorities, labor inspection agencies or the Bureau for protecting worker interests may, if necessary, check and verify the name list of employees and other relevant information and materials of business entities.
A worker may, upon discovering any violation of the Act by the employer, file a complaint with the employer, the Bureau, labor inspection agencies or the competent authorities; an employer shall not take any unfavorable measure against the worker who filed the complaint.
Article 41
The financial institution that is commissioned to utilize the Fund shall report to the Supervision Committee any undue interference, manipulation, instruction to utilize, or other situations detrimental to worker benefits. The Supervision Committee deems it as necessary and shall notify the Central Competent Authority to take necessary measures.
Article 42
Any person working at the competent authorities, the Supervision Committee, the Bureau, commissioned financial institutions and other relevant agencies or organizations shall refrain from disclosing confidential information obtained from performing his/her duties or seeking illegal profits, and shall perform fiduciary duties with prudent care for acquiring the maximal economic interests for workers and employers.
Article 43
The Central Competent Authority shall prepare the budget for paying the expenses required for the Supervision Committee and the Bureau to prepare and implement the administration prescribed in the Act.
Article 44
All account records, receipts, revenues and expenditures for the Bureau to handle businesses prescribed in the Act shall be exempted from taxation.

  Chapter Ⅵ Penal Provisions

Article 45
If the commissioned financial institution, which is in violation of Paragraph 2 to Article 33 to utilize the Fund in items other than those of specified investment and utilization, shall be fined no less than N.T.$2,000,000 but not exceeding N.T.$10,000,000, and the Central Competent Authority shall also order it to refund with interest accrued within a given period.
Article 46
When an insurer is in violation of Paragraph 2 to Article 36 and fails to notify the Bureau within a given period, it shall be fined no less than N.T.$60,000 but not exceeding N.T.$300,000 and fined consecutively on a monthly basis until the date of correction.
Article 47
When an employer is in violation of the payment criterion and time limit prescribed in Paragraph 2 to Article 11, Paragraphs 1 and 2 to Article 12, or Article 39, he/she shall be fined no more than N.T.$250,000.
Article 48
When a business entity is in violation of Article 40 by refusing to provide information and materials or taking any unfavorable measure against the employee who files a complaint, it shall be fined no less than N.T.$30,000 but not exceeding N.T.$150,000.
Article 49
When an employer is in violation of Article 9, Article 18, Paragraph 1 to Article 20, Paragraph 2 to Article 21, or Article 39, and fails to file the application for contribution, file the application for termination of contribution, or prepare the name list of employees; if the employer has been notified to improve within a given period but fails to improve by the end of given period, he/she shall be fined no less than N.T.$20,000 but not exceeding N.T.$100,000 and fined consecutively on a monthly basis until the date of correction.
Article 50
When an employer is in violation of Paragraph 1 to Article 13, and fails to continuously appropriate to the labor retirement reserve fund each month, he/she shall be fined no less than N.T.$20,000 but not exceeding N.T.$100,000 and fined consecutively on a monthly basis. The fine prescribed in Subparagraph 1, Article 79 of the Labor Standards Act shall no longer apply.
If the competent authorities fail to impose the fine in accordance with the preceding paragraph, their personnel concerned shall be subject to the relevant penal provisions prescribed by the statutes and regulations for the evaluation of civil servants.
The fines collected in accordance with Paragraph 1 shall be put into the Labor Retirement Fund referred to in Paragraph 2 to Article 56 of the Labor Standards Act.
Article 51
When an employer is in violation of Article 30 or Article 39, and deducts wages of employees, he/she shall be fined no less than N.T.$10,000 but not exceeding N.T.$50,000.
Article 52
When an employer is in violation of Paragraph 2 to Article 15, Paragraph 1 to Article 21, or Article 39, and fails to file the application or notify, he/she shall be fined no less than N.T.$ 5,000 but not exceeding N.T.$ 25,000.
Article 53
When an employer is in violation of Paragraph 1 to Article 14, Paragraph 1 to Article 19, or Paragraph 2 to Article 20, and fails to contribute within the time limit or contribute the full amount of labor pension, he/she is required to pay late payment charge at three percent of the amount of contribution on a daily basis for the period from the date following the date of expiration of the time limit until the date preceding the settlement date; however, the amount of such charge shall not exceed the amount of contribution.
When an employer fails to contribute the labor pension referred to in the preceding paragraph, if he/she has been notified to contribute within a given period but fails to contribute by the end of given period, he/she shall be referred to for compulsory execution in accordance with related statutes. If the employer refuses to comply, he/she may apply for administrative relief procedures in accordance with related statutes.
When an employer is in violation of Article 36 and Article 39, and fails to contribute within the time limit or contribute the full amount of premium, he/she shall be fined the same amount equal to the amount of premium and fined consecutively on a daily basis until the date of correction.
Paragraphs 1 and 2 shall become effective retroactively on July 1, 2005.
Article 54
The late payment charge and fine imposed in accordance with the Act shall be paid within thirty days after the date that the violator receives the notification; if they are not paid within a given period, he/she shall be referred to for compulsory execution in accordance with related statutes.
The businesses of imposing fine and enforcing compulsory execution concerning the annuity insurance prescribed in Article 39 shall be entrusted to the Bureau for handling.
Article 55
If the representative or any other staff member of a legal entity, the agent of a legal entity or a natural person, an employee or any other staff member violates the Act in the rendering of his respective services, the violator shall be punished pursuant to this Chapter; in addition, the legal entity itself or the natural person shall also be subject to punishment by such fine or administrative fine as prescribed in the respective articles of the Act; unless the representative of the legal entity or the natural person has done his/her best to avoid the occurrence of the violation.
The representative of a legal entity or the natural person shall be deemed as an offender, if he/she instigate or ignores the violation.

  Chapter Ⅶ Supplementary Provisions

Article 56
When a business entity is extinguished due to division, merger/acquisition, or transfer, the succeeding business entity shall be strictly liable for any labor pension not contributed.
Article 57
The enforcement rules of the Act shall be prescribed by the Central Competent Authority.
Article 58
The Act shall become effective after one year from the date of promulgation.