The government is under increasing pressure as laborers and employers unpack the details of a new workweek law and the general public begins to feel its impact.
Just days into the new year, the government’s workweek policy, which came into effect on Dec. 23, has already made headlines.
Following reports of businesses raising prices to make up for rising personnel costs, Premier Lin Chuan told the local daily China Times that “cost increases were inevitable” for labour-intensive industries.
Although Lin expressed hope that new rules governing overtime pay would prompt companies to increase employment or to give their workforce more rest time, businesses, workers and think tanks were not as optimistic.
‘A policy where hardly anyone wins’
The new rules may result in a “triple loss” for workers, businesses and consumers, according to Lai Cheng-yi, chairman of the General Chamber of Commerce of the Republic of China.
Secretary-General Tsai Lien-sheng, of the Chinese National Federation of Industries, spoke out against the inflexibility of the new policy, which he said “made scheduling work hours for businesses with five or fewer staff members impossible.”
New labour rules set a cap on overtime work and stipulate that employees must receive one day off for every six days of work.
Local media reported that employers were already having trouble hiring help – a problem set to be exacerbated by tighter constraints on scheduling and overtime pay.
Lin Bo-feng, chairman of the Chinese National Association of Industry and Commerce, Taiwan, compared the current price hikes to the “dual hikes” to fuel and electricity prices seen several years back.
He said the current situation was “worse than the dual price hikes of the past” because the latest hikes were accompanied by shrinking disposable incomes and rising operating costs.
The new workweek rules were”a policy where hardly anyone wins,” Tsai said.
Lin said the policy would raise business costs by 5 to 8 per cent – more than the 2 to 3 per cent increase prompted by the fuel and electricity price hikes.
Workers Return to Protest
Representatives from various workers’ union called themselves “the biggest losers” in the matter as they resumed demonstrations outside the Ministry of Labor Tuesday afternoon to demand what they called “much-needed action to close the loopholes” in the new workweek policy.
The new workweek policy faced massive opposition from workers’ groups even before its implementation last Dec. 23.
Guo Kuan-chun of the Joint Struggle of the Workers, the organizers of Tuesday’s demonstration, pointed out problems with a policy that he said could lead to “workers working more and getting paid less.”
A representative of The Union, Lin Po-yi called out the premier and businesses that were claiming an increase in operating costs.
Lin Po-yi alleged that businesses gained NT$63 billion (S$2.8 billion) from the scrapping of seven public holidays that workers previously enjoyed before the passage of the “one fixed day off, one flexible day off” bill.
These annual savings, he said, were greater than the amount needed to pay for overtime under the new labour law.
Other workers present alleged that their employers were exploiting loopholes to deny them their legally guaranteed extra wages and rest time.
Hsiao Nung-yu, a spokesman for the Taiwan Railway Labor Union, told reporters that the Taiwan Railways Administration had been able to comply with the new policy without “actually giving employees more time to rest.”
“Since the bill’s passage, employees at Taiwan Railways Administration have not received a single full day of rest,” Hsiao said.
In the case of the rail company, workers “are present at the stations every day” because, according to Hsiao, the railroad agency starts calculating each employee’s day off at the point when he or she leaves work.
Therefore, if one leaves a night shift at 7 a.m., his or her 24-hour day off would start at 7 a.m. and end the next day at the same time.
The employee would therefore be back at work the next day, she said.
Hsiao said that rest time was “purposely scheduled immediately after shifts” to avoid giving employees overtime pay.
Uncertainty Looms
With the workweek policy barely half a month into its implementation, only time will tell how the policy plays out, according to President Wu Chung-shu of Chung-Hwa Institute for Economic Research.
Wu said there were a few variables – such as end-of-the-year bonuses, merit-based bonuses and willingness to recruit – that businesses may change based on the new policy.
Chien Chin-han, head of Academia Sinica’s Institute of Economics, said that adjustments on behalf of workers’ rights could elevate the quality of manufacturing and services in Taiwan, but that flexibility should be ensured.
“Its (the policy’s) improvement of Taiwan’s manufacturing is not a bad thing, but the policy rules need to provide flexibility,” Chien said.
Meanwhile, Lai of the General Chamber of Commerce painted a more pessimistic picture with the example of a fruit picker.
He said that while this worker could earn NT$40,000 before the new law, he or she could now make only NT$30,000.
With no prospects of working overtime and earning overtime pay, it would be impossible for this fruit picker to provide for two children in college, he said.
Lai concluded his bleak depiction with both the employer and the employee being frustrated with the system, in which case, he said, everyone loses.
Read also: Taiwan labour laws: Two days off per week, maximum 40 working hours beginning 2016
