You can hire employees in Taiwan without the need for an entity.
Typically, to hire employees in Taiwan, your business must have an entity, which involves establishing a local office, registering an address as a subsidiary, and opening an account with a local bank. Managing regional benefits, payroll, tax, and HR laws throughout this process can take several months.
Taiwan has separate regulations for contractors compared to full-time employees, making it crucial to avoid misclassification to avoid potential penalties. ATA streamlines the process of hiring employees in Taiwan, ensuring speed, simplicity, and compliance. Additionally, our platform automates tasks such as tax document collection, payroll, benefits, and more.
Our quickstart guide to hiring in Taiwan
Navigate the tabs below to learn everything you need to know about hiring an employee in Taiwan
- Minimum Wage Requirements
- Starting from January 1st, 2023, the minimum wage in Taiwan has been updated, resulting in an increase from NTD25,250.00 to NTD26,400.00 per month.
- Individual Income Tax
- The range of individual income tax varies from 5% to 40% and is calculated using progressive rates. The total tax rates can be influenced by additional factors such as household status and the number of children.
|Type of leave||Time period|
|Annual leave/Earned Leave||7 days|
|Sick Leave||30 days|
|Maternity Leave||8 weeks|
There are several permissible reasons for the dismissal of an employee, including the closure of a business or transfer of ownership, the suspension of company operations for more than one month due to external factors, the need to reduce the number of employees due to a change in the company’s business nature and the absence of suitable job openings for redundant employees, as well as confirmed incompetence of an employee in carrying out assigned work. In cases where dismissal is necessary, the employer must provide notice and pay severance to the employee, except in situations where the employee has misrepresented facts at the time of signing the employment contract, engaged in violence against the employer, the employer’s family, or fellow employees, has been absent from work for three consecutive days or for six days in a month without a valid reason, or caused intentional damage.
During their probationary period, Taiwanese employees will receive a notice period of up to 10 days, whereas once they have completed their probation, they are eligible for a notice period of up to 30 days.
Severance pay is not mandated by law, and a termination without justifiable cause is considered illegitimate. Negotiation usually determines the amount of severance pay, which should be differentiated from other types of payments that might be required upon termination, such as a contractual retirement allowance.
An employer in Taiwan is obligated to provide certain statutory benefits as a part of their employee’s compensation package. These benefits comprise of:
- 13th-month pay, which is a customary payment made during the Lunar New Year and must be specified in the employee’s contract.
- Social security benefits, which are accessible to all resident and nonresident employees, including maternity benefits, unemployment benefits, pension benefits, health insurance, sick pay, and labor insurance.
- Statutory Leaves, which must be outlined in the employee’s compensation package and made clear through contract negotiations with potential hires. Employers must also offer a workweek consisting of 40 hours per week, with an employee allowed to work up to 8 hours per day for five or six days a week, along with two days off for every seven days worked, including one mandatory leave and one flexible leave.
- Overtime pay, which must be paid to an employee if they work additional hours due to business needs. The overtime pay rate is 34% of an employee’s regular salary for the first two hours, and 167% of an employee’s regular salary for the next two hours.
After the client signs the SOW, the onboarding process typically requires two-three business days.
- Employee contract
- The employment agreement can be written in Mandarin, Hokkien, English, or any language that is mutually comprehensible. However, if there are any legal disputes regarding the contract, it must be translated into Chinese before being presented as evidence in court.
- Probation period
- In Taiwan, there is no fixed or mandatory probation period specified by law. Employers and employees have the flexibility to mutually agree upon the duration of the probationary period. There is no maximum limit set for the length of the probationary period. However, it is customary for the probationary period to last for three months, during which the employer evaluates the employee’s performance before deciding whether to hire them permanently.
Our team is here to help, send us your requests or questions and we will get back to you shortly. You can also contact us on Social Media or by phone. We are looking forward to hearing from you.