Lawmaker lashes out at state firms’ bonus policy

UNFAIR DISTRIBUTION::A legislator said the bonuses that state firm workers get are almost equal to a year’s pay for about 850,000 private-sector employees

By Chris Wang  /  Staff reporter

Tue, Dec 25, 2012 - Page 3

A lawmaker yesterday accused state-owned companies of distributing high year-end bonuses regardless of the companies’ performance.

Employees of state-owned enterprises — such as CPC Corp, Taiwan, Taiwan Power (Taipower) and Taiwan Sugar — often received a year-end bonus of up to 4.6 months of salary regardless of how the companies performed during the year, Taiwan Solidarity Union Legislator Hsu Chung-hsin (許忠信) said.

Year-end bonuses are not listed as an official accounting category in state-owned enterprises and banks, but employees could receive a “review bonus” of up to two months’ salary and a “performance bonus” of up to 2.6 months’ salary annually.

State-controlled banks, including Bank of Taiwan and Chang Hwa Bank, cap the year-end bonus at 4.6 months’ salary, while banks with the government as a minority stakeholder, such as Mega Bank, distribute year-end bonuses as high as five-months’ salary, Hsu said.

Based on the records of five state-owned enterprises last year, almost every employee received a full review bonus, showing that “the bonus system had been exploited by those companies,” Hsu said.

The practice highlighted the phenomenon of unfair wealth distribution and could heighten social discontent given current economic difficulties and stagnant wages, Hsu said, adding that it was also in sharp contrast to the national average bonus of 1.05 months of salary estimated recently by a human resources company.

Workers who receive a monthly salary of NT$50,000 at state-owned companies would receive a year-end bonus of more than NT$200,000, he said.

Meanwhile, about 850,000 private-sector employees are paid less than NT$20,000 per month, according to statistics compiled by the Executive Yuan. That means the year-end bonus of a state-owned company employee would almost be equivalent to what a worker in the private sector makes in a year, Hsu said.

Lee Shao-yi (李少儀), an official with the Ministry of Economic Affairs’ State-owned Enterprise Commission, said that state-owned companies are obligated to adopt measures in line with government policies even if they are detrimental to the company’s interests, such as the past fuel and electricity price freeze, which contributed to the companies’ losses.

“It would be unfair not to recognize these employees’ efforts because they also worked hard,” Lee said, adding that the companies calculate and distribute bonuses according to employees’ contributions and performance.

Representatives from CPC and Taipower told the press conference that not all employees qualified for the full year-end bonuses.