The government of the Republic of China established its labor insurance program in March 1950, which is the first compulsory social insurance program. Subsequently, the Craft Workers’ Insurance Program was carried out in 1951, and the Fishermen’s Insurance in 1953. However, the Government promulgated the Labor Insurance Act until 1958 and put it into effect in 1960. In the meantime, all the three separate programs were nullified. The Act was amended in 1968, 1973, 1979, 1988, 1995, 2000, 2001, 2003, 2008, 2009, 2010, 2011, 2012, 2013, 2014 and 2015 for the purposes of expanding its coverage to more labors, offering better protection, and providing more generous benefits. Thus, the function of the Program has been successfully promoted. Since 1995 medical care for common accidents has been provided by the National Health Program. Due to the cooperation and support of the majority of employers and employees of various industries during the past forty years, the results of the Program have been quite encouraging. The success of the Program has effectively helped the Government carry out its economic development plan, resulting in a rapid economic growth, which is well known worldwide. As a consequence, more labor are covered by the program with more benefits.
In order to build up a complete labor insurance pension protection system and offer the insured person or insured person’s dependents long term living care, the government deliberates upon the opinions from all walks of life, takes Taiwan’s unique economic and social situation into consideration, and learns from the experience of advanced countries in the implementation of pension system to plan disability, old-age and survivor’s pension system, and the system has come into force on January 1, 2009. Before that, the labor insurance offered cash benefits include: maternity, injury or sickness, disability, old-age and death benefits. After the implementation of labor insurance pension program, monthly pension approach for claiming disability, old-age and death benefits have been added ,which are “old-age pension benefits”, “disability pension benefits” and “survivor pension benefits”. Through the implementation of the labor insurance pension scheme, laborers will obtain more complete labor insurance protection.
Insured persons may participate in the program compulsorily or voluntarily. The following workers above 15 full years and below 65 years of age shall be insured under this program compulsorily:
- Industrial workers employed by public or private factory, mine, salt field, range, pasturage, forest or tea plantation with more than five employees, as well as workers employed by a communication or transportation enterprise, or by a public utility.
- Workers employed by a company or firm with more than five employees.
- Employees in a journalistic, cultural, non-profit organization or cooperative enterprise with more than five persons.
- Employees of government offices or public or private schools who are not legally entitled to join civil servants’ insurance or the insurance of teachers and employees of private schools.
- Workers employed in fishing production.
- Persons receiving vocational training in vocational training institutes registered with the government.
- Members of an occupational union who have no definite employer or who are self-employed.
- Fishermen who belong to Class A of Fishermen’s Association and are either self-employed or do not have a definite employer.
Besides workers who are insured compulsorily, employers concurrently engaged in laboring services and persons employed in enterprises with less than five employees may also participate in the program on a voluntary basis.
Insured persons in this program shall be covered via the employers, or the organizations or institutes to which they belong as the insured units.
Insurance Enrollment Procedure and Insurance Effect
- According to Article 11 of Labor Insurance Act and Article 14 of Enforcement Rules of the Labor Insurance Act, the insured unit should file the “Insurance Coverage Application” and send to the Bureau of Labor Insurance for insurance enrollment on the day the labor reports for work, joins the association or start training courses. The insurance takes effect from the zero hour of the day the insured unit sends the coverage application to the Bureau of Labor Insurance or mail the application to the Bureau of Labor Insurance (using the post mark of the original sending post office as the reference day).
- If the insured unit doesn’t enroll the labors in the labor insurance coverage on the day the labor reports for work, joins the association or start training courses, the insurance takes effect from the following day of the day the insured unit notify the Bureau of Labor Insurance.
- If the worker’s position taking date is on national holidays, memorial days, weekend, the work suspension days due to natural disasters (typhoon, extremely heavy rain, etc.), or in the evening, the insured unit shall deliver or mail the insurance enrollment application and proof of employment to the insurer, and the effective date of the insurance shall commence at zero hour of the day on which the worker reports for work.
- According to Article 72, section 1 of Labor Insurance Act, an insured unit that violates the rules of this Act and fails to enroll its employees for employment insurance in accordance with the regulations of this Act shall be fined four times the total premium from the date of hire to the day before enrollment in the said insurance or the date of employment termination. The loss thus incurred by the employees shall be compensated by the insured unit in accordance with the payment standard defined in this Act.
* Definition of Insurance Salary
The monthly insurance salary of Labor Insurance should be filed based on the total amount of the insured person’s monthly salary according to the “Table of Grades of Labor Insurance Salary”.
* Timing for Insurance Salary adjustment
- If there is a change to the insured person’s average total monthly salary, the insured unit should file the Insurance Salary Adjustment Table to inform the Bureau of Labor Insurance.
- According to Paragraph 2 of Article 14 of the Labor Insurance Act, in case the reassessment of an insured person’s monthly insurance salary was made between February to July of the current year, the insured unit shall notify the insurer before the end of August of the current year, in case the reassessment was made between August of the current year to January of the following year, notification shall be made by the insured unit to the insurer before the end of February of the following year. The reassessed monthly insurance salary shall be effective on the first day of the month following the notification. Hence, the insured unit could see the actual needs of its business and the changes in employees’ monthly total salary to report the adjustment of the insured persons’ average monthly salary once at least every six month (February and August of each year). However, if there is a change to the insured person’s salary, the adjustment application could be reported at any time. It is not that the reassessment of insurance salary could only be done in February and August of every year.
The ordinary insurance premium rate is 7.5% ~13% of the insured person’s monthly insurance salary; the insurance premium rate was 7.5% when the amendments of this Act was promulgated and enforced on July 17, 2008, three years after the new regulation is en