Union urges reform of pension management

BALL AND CHAIN:Regulations guaranteeing a minimum return on funds discourage fund managers from dropping poor-performing stocks, the president of a union said

By Abraham Gerber  /  Staff reporter

National pension fund reforms should include changes to management to boost returns, a teachers’ union official said yesterday.

“We hope the government will acknowledge that, because legal restrictions have kept national pension funds from performing better, fund management should be reformed simultaneously with any changes to pensions,” National Federation of Teachers’ Unions president Chang Hsu-cheng (張旭政) said, adding that the Public Service Pension Fund increased by an average annual rate of 2.76 percent over the past 20 years, well below what he said was the average of 4 to 6 percent for similar funds in other nations.

National pension funds are facing the risk of going bankrupt within 20 years, with discussions on reform ongoing at a national pension reform committee, which was formed by the Presidential Office.

Chang said that while there is no evidence that pension funds had been used to make politically motivated investments, regulations guaranteeing a minimum return on funds create perverse incentives that discourage fund managers from dropping poor-performing stocks.

“While the minimum return guarantee might seem to be only a basic requirement, in practice, as fund managers are public servants subject to Executive Yuan restrictions, the guarantee ultimately serves to bind them, keeping them from cutting losses,” he said.

“If return on investment falls below the Bank of Taiwan’s official savings deposit rate, the government is obliged to make up the difference, but this is only calculated after investments are sold,” he said. “The Directorate-General of Budget, Accounting and Statistics often requires a fund’s managing committee not to sell falling stocks to avoid having to pay into the fund, but that keeps the fund from cutting its losses.”

Chang called for reforms to allow a portion of profits from the years when the funds outperform their target growth rates to be returned to the national treasury, along with regulatory changes to allow finance professionals to be hired to manage the funds, while paying them bonuses based on performance.

Taiwan's Unemployment rate inches up to 3.92 percent

Unemployment rate inches up to 3.92 percent

By Crystal Hsu  /  Staff reporter

The nation’s unemployment rate edged up to 3.92 percent last month, an increase of 0.08 percentage points from May, as new graduates joined the market, many of whom have yet to land positions, the Directorate-General of Budget, Accounting and Statistics (DGBAS) said yesterday.

Economic weakness contributed to the slow but gradual upswing in the jobless rate, which gained 0.21 percentage point from a year earlier, as firms remained conservative about adding headcounts despite the arrival of high sales season, the statistics agency said.

“The entry of new graduates will lift the jobless rate for the coming months until the impact of seasonality fades away in September,” DGBAS senior executive officer Pan Ning-hsin (潘寧馨) said by telephone.

The jobless gauge after seasonal adjustments stood unchanged at 3.96 percent last month, consistent with the nation’s stagnating economy, the DGBAS report showed.

For the first six months of this year, unemployment averaged 3.89 percent, rising for the first time in seven years, Pan said, as companies cut personnel costs to cope with business slowdown.

The local job market has felt the pinch since the second half of last year though the pace is modest this time, compared with the global financial crisis in 2008-2009, Pan said.

The statistics official shied away from speculating on a recovery, saying jobless rates are a lagging economic indicator and might not show improvement even when the economy starts to turn around.

The nation’s economy has contracted for three consecutive quarters ending the first quarter. The DGBAS is to release the preliminary second-quarter GDP figure on Friday next week.

The total number of unemployed people stood at 459,000 last month, an increase of 10,000 from May, as the number of first-time job seekers gained 9,000 and the number of people who quit their jobs increased by 1,000, the report said.

However, the number of people who lost their jobs due to business downsizing or closures dropped by 2,000, the report said.

Unemployment was highest among people with university degrees or higher at 4.78 percent, followed by people with college diplomas at 4.18 percent, the report showed.

The jobless rate stood at 3.93 percent for people with high-school education and at 3.19 percent for people with junior-high school education.

“People with higher education tend to change jobs if they are discontent with current ones,” Pan said.

In related news, monthly take-home wages averaged NT$39,260 in May, a 1.61 percent increase from the previous year, the DGBAS said in a separate report.

Average monthly wages, including bonuses and other compensation, amounted to NT$45,828 in May, an increase of 4.52 percent from a year earlier, the report showed.

For the first five months of the year, take-home wages rose to NT$39,098 per month, while average salaries fell 0.22 percent to NT$53,626, due to lower bonuses and performance compensations, the report said.

The inflation of 1.67 percent eroded real take-home and average wages by 0.08 percent and 1.86 percent respectively, the report said.

Taiwan No. 3 in work hours: union

‘OVERWORKED’:With the scrapping of seven national holidays, Taiwanese work 45 more eight-hour days per year than their OECD counterparts, a union said

By Sean Lin  /  Staff reporter

Taiwan will have the second-highest working hours in the world if the legislature fails to reinstate seven national holidays, which would defeat the purpose of the legislation to shorten work hours, the Taiwan Higher Education Union said yesterday.

Taiwan ranks third in working hours worldwide, after Mexico and Costa Rica, the union said, citing its own study.

The Ministry of Labor has proposed a bill that would give workers one fixed day off and one flexible rest day (一例一休), while the Chinese Nationalist Party (KMT) is promoting two fixed days off per week (兩例).

However, if the seven national holidays are not reinstated, Taiwan will have longer working hours than Organisation for Economic Co-operation and Development (OECD) member states and the second-longest working hours worldwide whichever bill is passed, the union said.

South Korea and Chile, whose development level is comparable with Taiwan’s, have 30 days off per year, compared with Taiwan’s 26 days, indicating that Taiwanese do not have an excess of holidays as the government has claimed, union director Lin Po-yi (林柏儀) said.

He said that many among the top 10 OECD member states — including Austria, France, Iceland, Sweden and the UK — have a higher GDP per capita than Taiwan, which he said debunks the government’s “terrorizing” rhetoric that granting people the seven holidays would hurt the nation’s economy and competitiveness.

Lin said Taiwan’s economic development emulates that of several OECD members, but the government has downplayed the severity of the dire situations Taiwanese workers face by distributing skewed information.

Given the nation’s long working hours and stagnant wages, the bill proposed by the ministry must not be passed, or Taiwan risks becoming an “overworked island,” he said.

Union secretary-general Chen Cheng-liang (陳政亮) said denying workers the seven holidays would result in longer working hours and thus be counterproductive to the aim of reducing working hours.

Chen added that no other country cancels national holidays while trying to reduce working hours.

Taiwan has 2,134 work hours a year, while OECD member states have an average of 1,771 hours, which means Taiwanese work about 45 more eight-hour days than their OECD counterparts, he said.

Union researcher Chen Po-chien (陳柏謙) said that from the previous KMT administration to the current Democratic Progressive Party government, one recurring remark by officials is that the seven holidays cannot be justified, as some historic figures or events are no longer worth commemorating.

However, the significance of holidays should not override workers’ need for rest, he said, citing Japan as an example, which in 1996 introduced its Marine Day and this year promulgated the “Day of the Mountains” as national holidays.

Lin said that unions would go on strike if the “ill-conceived” bill is passed.

Activists question draft labor law provision for lecturers

Activists question draft labor law provision

UNFAIR EXCLUSION:A Ministry of Education proposal could see university lecturers who take on other jobs denied protections under the Labor Standards Act, activists said

By Abraham Gerber  /  Staff reporter

A government plan to provide some part-time university lecturers with protections under the Labor Standards Act (勞動基準法) unfairly excludes lecturers who hold a second job, union activists said yesterday, questioning the legal foundation of the distinction.

“Under the new rules, you could get time off for being sick at your day job, but still be unable to claim leave for courses you teach at night,” Taiwan Higher Education Union office director Chen Shu-han (陳書涵) said, adding that a Ministry of Education proposal could see lecturers who take on other jobs denied protections under the act.

“There is no legal basis for the distinction based on whether you have another job — if you say that a particular field is within the scope of the Labor Standards Act, then the act should apply to all related workers,” she said, adding that under current rules, exceptions to the act are supposed to be based on the special nature of the work involved, ruling out distinctions between workers performing identical tasks.

Chen said the distinction would encourage schools to turn exclusively to part-time lecturers who are otherwise employed to avoid providing Labor Standards Act benefits, including various forms of special leave, contributions to lecturer’s national pensions, as well as lay-off protections and pay.

According to ministry statistics, universities employed 46,155 part-time lecturers in 2012, of whom only 8,118 did not have other jobs.

The number of part-time lecturers hired by schools has risen sharply in recent years, with schools increasingly using the part-timers to fill former full-time positions in the face of financial pressure caused by falling student numbers.

Protections against being fired have become a key issue as many schools consider downsizing.

My Opinion: Reforming The Military Will Not Help Taiwan's Working People

The word on the street is that there is something strange about the whole affair of a dufus firing an unarmed missile from a Taiwanese navy boat and hitting a fishing boat killing a sailor. We saw on TV the press stalk this guy on the street going to a meeting, with a big shit-grin on his face, as he tried to escape their prying eyes, like he didn't know what all the hubbub was about.

Erased was forty-five seconds of the tape that would have showed exactly what happened last week on that Taiwanese patrol ship when the missile was fired 'accidentally'. The navy officer in charge that day said he had left the scene of the crime, for just a second, to get a sip of water.

China is playing it cool, saying Taiwan should be more careful, and the corporate U.S. media is making a joke out of it, calling the dufus a fool, enough to justify Tsai Ying-Wen’s anger and loss of face. In all probability, the navy recruit who thought he was playing video games when he said “fire” and pressed the button, was an innocent stooge allowed to make a mistake accidentally on purpose, like those Saudis, learning to fly jets in Florida, but not learning to take off or land. The CIA didn’t watch them; they watched four commercial jets make unscheduled stops on September 11, 2001 killing four thousand people and used the disaster to usher in the police state; this Taiwan missile only killed one, but what is the difference?

 It is either benign neglect, or simply taking a random situation and bending it to meet a government's political agenda that we are watching here. Tsai Ying-Wen and the DPP will not lose this opportunity to remind the people of Taiwan, and appease Washington hawks, that China is still a good enemy to have when Taiwan could be a good link in a chain to contain Chinese influence in Asia.

The U.S. will not lift a finger to support independence for Taiwan any more than it would for Puerto Rico, another island they just can’t seem to get out of their system. Need I remind anyone that China is located in Asia, 129 miles from Taiwan, and that the United States is not; that the national language and residual culture of Taiwan and China is Chinese?

It would all be well and good if the U.S. exported worker unionism, and not promoted sweatshop outsourcing to Taiwanese business people all over Asia. It would all be good if the U.S. was a model of true democracy, and not some neo-liberal two-party charade.

Tsai Ying-Wen will milk this stooge’s error for all it is worth, not that her on-camera tears to the deceased's wife weren’t real, but perhaps, more to the point, she can put a dent in the KMT rapprochement with China.

For eight years, the KMT of Ma Ying-Jeou let the militarism of their past martial law dictatorship drift away; a militarism that was reinforced by the U.S. for a record thirty-seven years supporting “Free China.” But now that the KMT has changed sides and thinks China would be better for Taiwan’s future than a twentieth century English-speaking colonial white-Angelo-Saxon Protestant power holdover, the U.S. is on the other side.

The U.S. government had only expansionist ruling-class motives for being one of the foreign powers that forced its way into China to sell opium and stole the Philippines from Spanish colonists in the nineteenth century, stifled Japanese growth starting World War II in the Pacific, occupied Okinawa and Taiwan, divided Korea, and slaughtered millions of Vietnamese and Cambodian  civilians and soldiers with napalm and agent orange, and American soldiers with morphine and insanity. What useless second-hand, obsolete multi-million dollar weapons system will the U.S. force Taiwan to buy next? 

There is no alternative for the working people in Taiwan but to organize independent unions and demand better working conditions, shorter hours and higher pay. The U.S. is not going to protect them from exploitation, nor is the KMT, DPP, or even a corrupt PRC. The workers must do this for themselves. Rebuilding military discipline, even expanding the draft time for recruits, as some have suggested, is counter-productive and only an excuse to waste more New Taiwan tax dollars on needless weapons that could not protect Taiwan from either superpower. Workers on both sides of the Taiwan Strait share the same goal as workers in the U.S. and elsewhere. No neo-liberal party politics will win their strikes. 

Tsai touts ‘drastic’ reforms of military

TAKING CHARGE:The president said that she would not evade problems within the armed forces and would not shirk her responsibility as commander-in-chief

By Stacy Hsu  /  Staff reporter

President Tsai Ing-wen, front center, attends a joint graduation ceremony at the National Defense University and National Defense Medical Center in Kaohsiung yesterday.

Photo: CNA

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President Tsai Ing-wen (蔡英文) yesterday urged the military to stride forward at a steady pace amid public criticism over recent controversial incidents implicating military officers, pledging to not shirk her responsibility as commander-in-chief of the nation’s armed forces and to push for drastic reforms.

“Over the past few days, some incidents occurred within the armed forces. I believe all of you are worried and, in the face of criticism from all sectors of society, upset or even feel dispirited just like me,” Tsai said in a speech during a joint graduation ceremony of the Military Academy, Naval Academy, Air Force Academy, National Defense University and National Defense Medical Center in Kaohsiung yesterday morning.

Calling on the military to have the courage to face its mistakes and challenges, Tsai said the greater the frustration soldiers encounter, the larger steps they should take in their march forward.

Tsai said she would not sugarcoat recent controversies involving the military and tell them that everything about the nation’s armed forces is positive.

“Saying so while standing right here would make me an irresponsible commander-in-chief. I will not evade problems, nor will I shirk my responsibility. Our armed forces require reforms and they should be bold and drastic reforms,” Tsai said.

Tsai’s speech came on the heels of the navy’s accidental launching of a locally developed Hsiung Feng III missile from a 500-tonne Chinchiang-class corvette at Zuoying Military Harbor in Kaohsiung during a drill on Friday last week.

The missile struck a Taiwanese fishing boat, the Hsiang Li Sheng (翔利昇), operating in waters southeast of Penghu County in the Taiwan Strait, killing its captain, Huang Wen-chung (黃文忠), and injuring three crew members.

The missile blunder further fueled a public outcry directed at the military, which had faced an outpouring of criticism over the killing of a dog by marines at a military base late last month.

The president said the key problems facing the nation’s armed forces include military officers’ lack of strategic guidance, defense resources, the size of the army, arms and the gap between national defense construction and economic development.

“We will also reform the military’s system and culture. The superficial formality, waste of manpower and insufficiency are all focuses of our reform,” Tsai said, vowing to make military officers gradually see changes in the armed forces’ system.

Later yesterday, Tsai paid her respects to Huang’s family in Kaohsiung, accompanied by National Security Council Secretary-General Joseph Wu (吳釗燮), Kaohsiung Mayor Chen Chu (陳菊) and Kaohsiung City Council Speaker Kang Yu-cheng (康裕成) of the Democratic Progressive Party.

Presidential Office spokesman Alex Huang (黃重諺) said Tsai, in her capacity as commander-in-chief, extended her sincerest apologies to Huang Wen-chung’s wife and other family members, and vowed to ascertain the truth about the incident as soon as possible.

Alex Huang said Tsai told the victim’s family that she has instructed the Ministry of National Defense and the Ministry of Justice to form an ad hoc group to investigate the incident.

As Huang Wen-chung was his household’s main source of income, Tsai also asked Chen and the defense ministry to help the victim’s family apply for state compensation, Alex Huang said.

Unions hold protest over workweek

By Abraham Gerber  /  Staff reporter

Labor unions members yesterday clash with police during a demonstration outside the Executive Yuan in Taipei.

Photo: Chang Chia-ming, Taipei Times

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More than 100 union members yesterday protested outside the Executive Yuan and Legislative Yuan, calling for restrictions on “compensatory holidays,” as a debate over the implementation of a universal 40-hour work week continues.

Shouting slogans slamming negotiations with business groups and demanding the preservation of public holidays, union members demonstrated for more than one hour, pressing against the police line outside the Executive Yuan before marching to the Legislative Yuan, shouting that they would monitor members of the Democratic Progressive Party (DPP) leadership and Social Welfare and Environment Hygiene Committee after amendments by the Executive Yuan to the Labor Standards Act (勞動基準法) are submitted.

The proposed amendments are to give workers two days off per week, with more stringent overtime requirements and higher pay for work performed during off days, in response to labor campaigners’ argument that mandating a 40-hour workweek would not guarantee a five-day workweek without additional regulations over weekly off days.

Overtime pay rates have been a key point of contention because of plans to cancel seven national public holidays to compensate for the reduction of weekly working hours, with campaigners saying that the changes could lead to pay reductions because of differences between regular overtime wages and those for national holidays.

Representatives from 14 union confederations who participated in the protest signed a pledge rejecting negotiating the issue with business associations, after seven major business groups said they would terminate government-sponsored negotiations earlier this week, after the Ministry of Labor last week issued an order temporarily restoring the public holidays, prior to the passage of the amendments.

Another ministry order issued earlier this week forbids working more than sic consecutive days without taking a day off.

Protesters called for additional restrictions to keep employers from using flexible working hours and compensatory holidays to get around higher overtime rates.

“If you do not restrict compensatory holidays [or off days that employers grant employees when they work overtime without pay], the increase in overtime pay is not real,” Taipei City Confederation of Trade Unions executive director Chen Shu-lun (陳淑綸) said.

Businesses were likely to take advantage of the current one-to-one ratio for compensatory holidays to avoid paying higher overtime rates and criticized the ministry for failing to restrict the use of flexible work time provisions, Chen said.

“The original purpose of flexible work time was to allow workers to concentrate their work time in return for more time off, but the required negotiations between employers and employees are not implemented in practice, allowing the employers to use flexible work time provisions to arbitrarily tell employees when they have to work,” she said.

“Many companies require workers to work on Saturdays, while offering additional off days instead of overtime pay, but the problem is that if the off days are not taken within several months they are forfeited,” Tainan Confederation of Trade Unions secretary-general Huang Yu-te (黃育德) said, calling for compensatory holidays to be granted to workers within one week.

Cabinet passes labor act amendments

HOLIDAY DISPUTE:The government has come under fire for revising its stance on whether to cancel seven national holidays as proposed by the Ministry of Labor

By Loa Iok-sin  /  Staff reporter

Executive Yuan spokesman Tung Chen-yuan yesterday speaks during a news conference at the Executive Yuan in Taipei.

Photo: Chang Chia-ming, Taipei Times

The Cabinet yesterday passed amendments to the Labor Standards Act (勞動基準法) proposed by the Ministry of Labor, which would introduce “one fixed day off and one flexible rest day” — or yili yixiu (一例一休) — as two weekly days off to guarantee the realization of the 40--hour work week policy, while canceling seven days off for national holidays.

“With efforts from the Ministry of Labor, Executive Yuan staff and the Democratic Progressive Party [DPP] caucus, we have finally produced this version [of amendments]. Despite all the difficulties, it is a more feasible version that would lead to as little conflict as possible,” Premier Lin Chuan (林全) was quoted as saying by Cabinet spokesman Tung Chen-yuan (童振源) in a post-meeting news conference. “However, there are still differences of opinion, and we need to continue to communicate with the public.”

According to the ministry’s proposed amendments, employers may ask employees to work on their “fixed day off” only in the event of a natural disaster or emergency, and would have to compensate employees with double salary for the day plus an additional day off to make up for it.

Regarding the “flexible rest day,” employers may ask employees to work after obtaining their consent, but are obligated to provide additional pay, ranging from one and one-third to one and two-thirds times the worker’s basic salary.

However, employees would not get an extra day off if they work on a “flexible rest day.”

Moreover, the proposal would also cancel seven holidays for workers to make all workers, including civil servants, enjoy the same number of national holidays.

The Cabinet’s final amendment proposals drew fire from both labor rights advocates and businesses.

Labor rights activists have been calling for two fixed days off per week and to keep the seven national holidays, while businesses have complained about the high overtime pay they have to offer employees to have them work on a “flexible rest day.”

The seven holidays that the ministry proposed to cancel were also a point of dispute as the government has revised its stance about whether to keep the holidays several times, and has been accused by labor activists of breaking its promise.

Separately, DPP caucus chief executive Wu Ping-jui (吳秉叡) said after a lunch meeting with the premier that the caucus would seek to pass the amendments in September.

“The premier would like the amendments to be passed as soon as possible, so that businesses can more accurately calculate their costs,” Wu said.

He said that not all caucus members supported the proposals, but added that working conditions would improve with the amendments, as they would require employers to provide more overtime pay and obtain consent from their employees to have them work on their rest days.