Any type of work that is carried out beyond the regular working hours is considered as overtime, which corresponds to overtime pay. But have you ever wondered how your overtime pay is computed?
When it comes to workers’ salaries and benefits, including overtime, the Labor Standards Act of Taiwan provides some key guidelines. By being aware of these provisions, employees such as yourself can estimate your latest salary after working overtime.
OFW Guide to Calculating Overtime Pay
Based on the Labor Standards Act, the normal or regular working hours in Taiwan is 8 hours a day, or 40 hours a week. Work performed beyond these hours is considered overtime, and is therefore eligible for overtime pay.
Overtime Hours
Speaking of overtime, up to how many hours can a person work beyond regular hours in a day, a week, or a month? Let’s take a closer look at overtime hours in terms of daily, weekly, and monthly limits.
Daily Limit
In Taiwan, a person can work overtime up to 4 hours in a day. If we add this to the regular 8 working hours, this means that he/she can work up to a maximum of 12 hours per day, including overtime.
Weekly Limit
Of course, even if a person can work 12 hours per day, it doesn’t mean that he/she should work this long every day of the week!
There’s a weekly work limit for employees in Taiwan: 48 hours. This includes regular and overtime work. So if the regular work hours is 40 hours a week, employees can render up to 8 hours as overtime within the week.
Monthly Limit
Finally, Taiwan has a monthly limit for overtime work: 46 hours. This means that employees should not be working overtime beyond this amount… unless their company has prior consent or an agreement with labor unions or labor-management conferences. If this is the case, employees can render up to 54 hours a month, and up to 138 hours within three months — as overtime work.
Overtime Pay
Payment for working overtime is not the same rate as payment for regular hours. Article 24 of the Labor Standards Act prescribes an overtime rate for the first two hours, for the third and fourth hours, and for working during public holidays, emergencies, etc.
First Two Hours
If your overtime work does not exceed two hours, you should receive an additional 1/3 of the regular hourly rate. In other words, your overtime pay should be 134% of the regular rate.
For example, if your regular hourly wage is TWD 190, then your overtime pay can be computed as follows: TWD 190 x 1.34 = TWD 254.60 per hour.
Three to Four Hours
Now, let’s say that your overtime work exceeded two hours… you worked for three to four hours instead. In this case, you should receive an additional 2/3 of the regular hourly rate. This means that your overtime pay should be 167% of the regular rate.
Hence, if your regular hourly wage is TWD 190, then the calculation of your overtime pay is: TWD 190 x 1.67 = TWD 317.30 per hour.
Public Holidays and Emergencies
What if you had to work during a public holiday, or when there’s a natural calamity or emergency? Since these are not regular working days, you should be paid two times or 200% of the regular rate.
Therefore, if your regular hourly wage is TWD 190, then your overtime pay can be calculated as follows: TWD 190 x 2 = TWD 380 per hour.
Additional Reminders
Aside from the above guidelines on overtime hours and overtime pay, there are other important provisions in the Labor Standards Act:
First, it is mandatory for workers two have 2 days off every 7 days. One of these days off is “compulsory,” while the other day is more “flexible” and can be rendered as overtime — as long as the employer and employee agree.
Secondly, for female employees… they should not be compelled to work between 10:00 pm and 6:00 am, unless the workplace meets safety provisions in the Work Rules.
Finally, if the company has 30 or more employees, it is required to report work hour extensions to the local competent authority.
Just like in any other country, Taiwan has laws for overtime work, and all employers should comply with them. This includes ensuring that workers are not compelled to work beyond the overtime hour limits, and that they are paid according to labor standards.
Meanwhile, as an employee, you should also strive for what we call a “work-life” balance. Do not overwork yourself to the point that you get burned out… physically and/or mentally! Check out this article to learn more about having a work-life balance in Taiwan.