The estimated severance pay is calculated on the basis of the employment date, the end
date of the labor contract, the date of application of the Labor Standards Act
(hereinafter referred to as the Act), the date of conversion to the new system, the
average wage, etc., that you fill in.
If the labor contract is terminated according to Article 11, proviso to Article 13,
Article 14 and Article 20 of the Labor Standards Act or Article 84 or Article 85 of the
Labor Occupational Accident Insurance and Protection Act, the employer shall provide the
laborer with the severance pay in accordance with the law.
The principle of application at different stages for severance pay before and after the
application of the Act:
According to Article 84-2 of the Act, the seniority of the laborer shall be
counted from the first date of employment.
For the seniority before the application of the Act, the standards of severance
pay shall be calculated in accordance with the then applicable laws and
regulations; If there were no applicable laws and regulations, they shall be
subject to the rules formulated by each respective business entity itself, or
agreed upon by employers and employees (For the seniority before the application
of the Act, due to the standards of each business entity varying, the
calculation of the estimated severance pay before the application of the Act is
not provided with this calculator. Please calculate it by yourself and fill in
the field of “The severance pay agreed upon between the employer and employee”.)
The standards of severance pay on the seniority pension system under the Act
shall be calculated in accordance with the provisions of Article 17 of the said
Act. If the laborer has already met the requirements for voluntary retirement
when he or she is severed, the pension shall be paid for such a period of
seniority in accordance with the provisions of Articles 55 and 84-2 of the said
Act (Please refer to link 1).
The standards of severance pay in the new seniority pension system after the
implementation of the Labor Pension Act shall be calculated in accordance with
Article 12 of the Labor Pension Act.
End date of the labor contract: It refers to the ending date of the term of the labor
contract.
The date on which the business entity becomes applicable to the Labor Standards Act: It
refers to the date designated by the Ministry to apply to the Labor Standards Act. If
you have any questions about the application date of the Labor Standards Act, please
refer to link (2), or call our toll-free number 1955 for consultation.
Average wage:
Paragraph 4, Article 2 of the Labor Standards Act stipulates: “average wage”
means the figure reached by dividing the total wages for the six months
preceding the day on which an event requiring that a computation be made occurs
by the total number of days in that period. In the case of a period of service
not exceeding six months, the term "average wage" means the figure reached by
dividing the total wages for the service period by the total number of days of
that period. In the case of wages which are computed on a daily, hourly, or
piecework basis, if the "average wage" figure reached according to the preceding
formula is less than 60% of a figure determined by dividing the total wages for
the particular service period by the actual number of work days, the "average
wage" in this case shall be the 60% figure.
According to the official letter No.: Tai-1994-Lao-Tung-2-Tzu 25564 issued by
the Council of Labor Affairs on April 9, 1994, the "average wage per month"
shall be calculated by dividing the total wages of the six months before
retirement or severance of the laborer by 6 directly. For example, if the end
date of the labor contract of a severed laborer is March 16, 2012, the worker’s
average wage is the total wages between September 16, 2011 and March 15, 2012
divided by 6.
Article 2 of the Enforcement Rules of the Labor Standards Act stipulates that
wages and the number of days in the following days or periods shall not be
included for the purpose of calculating the average wage referred to in
Subparagraph 4 of Article 2 of the Act:
The day on which the event occurs requiring calculation to be made,
The period of medical treatment for occupational injury,
The period in which wages are paid at half the normal rate in accordance
with Paragraph 2 of Article 50 of the Act, and
Where, due to a natural disaster, an unexpected event, or other force
majeure, the employer cannot continue business operations which results
in employees failing to work.
Employees who take ordinary sick or injury leave according to the rules
of leave.
Employees who apply for menstrual leave, maternity leave, family care or
recuperation leave and receive reduced wages according to the Act of
Gender Equality in Employment.
Employees on unpaid leave.
Paragraph 3, Article 2 of the Labor Standards Act stipulates: “Wages mean the
remuneration which a worker receives for his/her services rendered, including
wages, salaries and bonuses, allowances and any other regular payments
regardless of the name which may be computed on an hourly, daily, monthly and
piecework basis, whether payable in cash or in kind.”
Standards of severance pay:
The seniority under the Labor Standards Act: Article 17 of the Labor Standards
Act stipulates that the severance pay that is equal to the average wage of 1
month for each full year of service shall be paid; for the seniority of less
than 1 year, it is to be paid proportionally; for the seniority of less than one
month, it shall be calculated as 1 month.(
Please refer to the Decree No. Lao-Tung-4-Tzu-1010132306
issued by the Council of Labor Affairs on September 12, 2012.
)
Online Severance Pay Calculator
※ This system provides calculation for reference only.
For the detailed and accurate amount, please conduct the calculation according to the actual case.
Trial calculation results
