Sun, Jan 13, 2013 - Page 1 News List

Lawmakers push for revision of bonuses cap

NOT FAIR:New standards for allocating year-end bonuses to employees of state-owned firms cannot work on the ‘one-size-fits-all’ principle, the People First Party said

By Shih Hsiu-chuan  /  Staff Reporter

Following mounting criticism over a legislative decision about bonuses for workers at state-owned firms based on company performance, the People First Party (PFP) has sought a reversal of the policy before the legislative session ends on Tuesday.

On Monday last week, lawmakers decided that only profit-making state-owned firms could distribute such bonuses, with the amount capped at an amount equivalent to less than 1.2 months’ salary. The decision, which caucus whips of all parties agreed to at a cross-party negotiation meeting, raised ire from trade unions in state-owned enterprises.

Some government officials, including Premier Sean Chen (陳冲) and Central Bank Governor Perng Fai-nan (彭淮南), have expressed concern that the policy would serve as a disincentive for people to work in state-owned enterprises, as well as for employees to remain at state-owned companies.

PFP caucus whip Thomas Lee (李桐豪) said yesterday that his caucus would seek to revise the policy, after the legislature on Friday adopted a resolution demanding that the Executive Yuan put forward new standards for allocating bonuses within three months.

The resolution was sponsored by the PFP and was adopted by the legislature without objection.

A new proposal for the allocation of bonuses, if adopted by the legislature, could replace the decision made on Monday last week, Lee said.

Lee said that lawmakers were “not meticulous enough” in setting the standards for allocating bonuses, because the “one-size-fits-all” principle failed to take into account the individual characteristics of state-owned enterprises.

“They face different market conditions and the responsibility borne by each enterprise is different,” he said.

Taiwan Solidarity Union (TSU) caucus whip Hsu Chung-hsin (許忠信) disagreed with Lee.

Because the TSU supported the PFP-initiated resolution did not mean that the legislative decision made on Monday last week can be overruled, he said.

Hsu added that the legislative decision was a principle that has to be abided by when the Executive Yuan draws up new standards for the allocation of bonuses, because “any conclusion reached at cross-party negotiation meetings has binding force.”

The argument that the “one-size-fits-all” principle did not work for all state-owned firms was “indefensible,” Hsu said.

“The size of the bonus was capped at an amount equivalent to under 2.6 months’ salary. Why didn’t they question the principle when the bonus ceiling was higher?” he said.

Democratic Progressive Party caucus whip Tsai Chi-chang (蔡其昌) said he would like to reconsider the legislative decision to apply different standards when deciding the allocation of bonuses to different state-owned firms, if the standards are “reasonable.”

“For example, considering the competition in the banking industry, workers at state-owned banks should receive higher bonuses if the banks make profits,” he said.

Chinese Nationalist Party (KMT) caucus whip Wu Yu-sheng (吳育昇) said that the legislative decision made at the cross-party negotiation meeting was valid only for bonuses linked to company performances last year.

Under the current system, employees at state-owned enterprises can receive a bonus equivalent to a maximum of 4.6 months’ salary at year-end, composed of two elements — an amount equivalent to 2.6 months’ salary, based on the company’s performance, and an amount equivalent to maximum two months’ salary based on employees’ individual job performance.

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