The Council of Labor Affairs (CLA) is mulling amending labor regulations to subsidize businesses’ salary expenses if the jobless situation reaches a certain level.
Under the proposals, a company could receive subsidies of up to half of the amount by which it cuts salaries, if salaries are decreased by between 20 percent and 60 percent through measures such as unpaid leave. A firm could be subsidized by as much as 70 percent if it puts its employees on a training program during a production slowdown.
While the plan appears to be rewarding businesses for cutting salaries, the council said it was aimed at preventing layoffs.
If businesses cut salaries or put workers on unpaid leave during economic downturns instead of laying them off they would be able to quickly revamp production when situations improve, as well as help alleviate an increase in the jobless figures, council officials said.
Under the proposal, a company might be able to apply for subsidies in the event that the unemployment rate of workers covered by the national labor insurance plan exceeds 2.2 percent for at least three consecutive months.
In other words, if the number of people on unemployment benefits comprises more than 2.2 percent of the total working population, unemployed and employed, who participate in the national labor insurance program, and if the total unemployment rate during this period of time has not decreased, then businesses may be eligible to apply for subsidies.
An exception to this rule would be if the country faces severe, uncontrollable conditions such as a natural disaster.
Other restrictions, such as keeping salaries above the minimum monthly wage of NT$17,280, would still apply. Companies would have to reach an agreement with their labor union or through a labor-management meeting before cutting salaries or working hours. The proposal would only apply to full-time employees who work at least 35 hours a week before going on unpaid leave.
Companies with employees who participate in on-the-job training for at least 16 hours a week could be eligible for up to 70 percent of wage subsidies.
The council has not announced a timeline for approving or implementing the proposal.
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