Taiwan, officially known as the Republic of China (ROC) is a country in East Asia, with the main island of Taiwan being formerly known to Westerners as Formosa. It has a workforce of 12 million people (2024) and a GDP of 814 billion US dollars (2025).

The economy of Taiwan is highly developed, being one of the most dynamic and fast growing in Asia. It is the global leader in semiconductor manufacturing, with prominent industries including banking, technology, and transportation. Taiwan has also been long known for its agriculture, with rich volcanic soil, good rainfall, and warm climate. Labor law is considered highly important in Taiwan, with a focus on minimum wage, working hours, rest periods, and safety conditions.

This help guide will offer a thorough insight into Taiwanese labor laws, providing information on mandatory employee benefits as well as supplementary benefits companies should consider. We’ll also give information on how Remote People can help when it comes to hiring employees in Taiwan, ensuring compliance and efficiency when adhering to Taiwan labor law.

Taiwan Employment Laws

Taiwanese labor law is governed by the Labor Standards Act (LSA) of the Ministry of Labor in Taiwan. The act was first enacted in July 1984 and has been amended as recently as July 2024.

This act contains laws related to employee benefits such as contracts, pay, working hours, holiday, retirement and maternity. 

It’s crucial to consult with legal experts when employing in Taiwan to ensure all Taiwanese labor laws are adhered to.

Mandatory Employee Benefits in Taiwan

We’ve included below a list of mandatory employment benefits that companies must provide when hiring in Taiwan.

Social Security

The rate of social security in Taiwan is 17.22% split equally between employees and employers. This rate is compulsory and covers a range of programs including:

  • The Labor Insurance Program (LIP)
  • The National Health Insurance Program (NHIP)
  • Labor Pension Program (LPP)

Contracts

Employment contracts in Taiwan are divided into two categories: fixed-term contracts and non-fixed term contracts.

A fixed term contract must be for work that is temporary, seasonal, or short-term, and must adhere to a set period of time as dictated in an employment contract. Non-fixed term contracts are for continuous work without an explicit end date.

Minimum Wage

Companies employing in Taiwan must pay their employees the minimum wage of NT $29,500 per month, or NT$196 per hour (2026).

This rate has increased by 3.18% when comparing figures from the previous year.

The National Government of Taiwan first enacted the “Minimum Wage Act” in December 1936, prescribing that adult wages “must maintain the standard of living necessary for oneself and two other family members who were incapable of support”.

Annual Paid Leave

Employees in Taiwan are entitled to annual paid leave, provided they have continually worked for the same employer for a certain period of time. The following annual paid leave will be granted to employees in Taiwan:

Years of Service Annual Leave (Days)
6 months – 1 year 3 days
1 year – 2 years 7 days
2 years – 3 years 10 days
3 years – 5 years 14 days
5 years – 10 years 15 days
Over 10 years One additional day per year, maximum 30 days

Working Hours

The maximum number of hours an employee in Taiwan can work is limited to 8 hours a day or 40 hours a week (12 hours a day and 48 hours a week including overtime).

Employees should have 2 days off for every 7 days worked (one compulsory and one flexible), and shift workers must be compensated with appropriate rest periods.

Overtime Pay

Hours worked over an employee’s contract counts as overtime, and employees must be compensated accordingly for the hours worked. Overtime is limited to 4 hours per day, and the total worked hours per week must not exceed 48 hours (including overtime).

If the overtime work does not exceed 2 hours, the employee should be paid at least 1 additional third of their hourly rate.

If the overtime work exceeds 2 hours, but is less than 4 hours, the employee should be paid at least 2 additional thirds of their hourly rate. Overtime carried out on a weekend or rest day should be paid at a minimum of double the rate of an employee’s hourly rate.

The monthly limit on overtime for an employee in Taiwan is 46 hours, however, overtime hours can be increased to 54 hours per month with prior consent from a labor union.

Paid Public Holidays

Employees in Taiwan are generally granted paid leave for public holidays. The public holidays occurring in Taiwan are as follows:

  • New Year’s Day (January 1)
  • Republic Day (January 1)
  • Chinese New Year Holiday (February 16 to February 20) (date varies)
  • 228 Peace Memorial Day (February 28)
  • Children’s Day Holiday (April 3)
  • Children’s Day (April 4)
  • Qing Ming Festival (April 5)
  • Labour Day (May 1)
  • Dragon Boat Festival (June 19) (date varies)
  • Mid-Autumn Festival (September 25) (date varies)
  • ROC National Day (October 10)

Paid Sick Leave

Sick leave in Taiwan provides employees with 30 days of paid sick leave each year at 50% of an employee’s regular salary. If the illness is covered by labor insurance but the compensation is less than half their regular salary, their employer is required to pay the remainder.

If hospitalized, employees can take up to 1 year of sick leave within a 2 year period.

Employees are required to provide a medical certificate if they exceed 3 days of sick leave. If employees use all sick days they’re entitled to, they can usually request additional unpaid days off at the discretion of their employer, up to the limit of 1 year.

Maternity Leave

Female workers are entitled to maternity leave before and after childbirth. This is limited to a combined period of 8 weeks.

If the worker has been employed by the company for less than 6 months they are entitled to 50% of their regular wages, whereas workers that have been employed for over 6 months will be paid their full wage over this period.

In the case of miscarriage after the first 3 months of a pregnancy, female workers may cease working and be granted 4 weeks of maternity pay at the same rates as mentioned in the previous paragraph.

Employees in Taiwan that are pregnant or breastfeeding are not permitted to work between the hours of 10pm and 6am.

Paternity Leave

Employees are entitled to 7 days paid paternity leave to support their partner that has given birth. To be eligible for paternity leave, the employee must meet the following conditions:

  • They must have been working for their employer for 6 months
  • Their child must be under 3 years of age
  • Their spouse must also be employed

Employers may apply for compensation for 2 of the days of paternity leave from the Taiwanese central government.

Employees in Taiwan can also apply for 2 years of unpaid parental leave. Parents must file an application with their employers at least 10 days in advance of the start date, and must not work for another company while on unpaid parental leave.

Severance Pay

Employers terminating a contract must pay an employee severance pay.

This pay must be an average of half 1 month’s average wage of each full year of employment, up to the limit of 6 months, and severance pay must be paid in full within 30 days of termination of the contract.

Severance pay is prorated if the employee has worked for the company for less than 1 year.

Supplementary Employee Benefits in Taiwan

There are several supplementary employee benefits that companies can offer to attract potential candidates, and improve staff retention levels. Some supplementary employee benefits employers should consider include:

  • Advanced pension opportunities
  • Private healthcare/dental care
  • Performance bonuses
  • Expenses such as food, transport, and housing

Optimize Employee Benefits with Remote People

Staying compliant with Taiwanese labor laws can make employers uneasy about employing in Taiwan. That’s where Remote People can make the process easier and more efficient.

Our support covers key areas of employment in Taiwan including payroll, benefits guidance, and regulatory compliance. If you want to hire quickly without setting up a local entity, our Employer of Record service provides a straightforward way to onboard and manage staff while meeting all statutory obligations. It’s a practical solution that helps reduce administrative burden and minimizes the risk of compliance issues.

We can also help you to hire the best Taiwanese employees for your business via our Taiwan recruitment services. You can put your trust in our experienced team and relax knowing that they’ll help you to navigate finding the best talent for your business.