Fixed-Term Contracts under Taiwan law
An employee is hired on a permanent basis by default, but the law allows for certain exceptions through a fixed-term contract. Under a fixed-term contract, employment ends automatically on the day mentioned in the employee’s contract, so the company need not give prior notice nor pay for severance.
There are 4 kinds of fixed-term contracts. The first involves the “temporary” nature of the employment, where the demand of the job is unpredictable and may be completed within a 6-month period.
The second kind of fixed term contract, well, involves employment that may be predictably completed within a 6-month period.
The third kind of fixed-term contract involves work that is affected by the seasonal materials, supply sources or market sales, and that can be completed within a 9-month period.
The last kind of fixed-term contract involves work that can be completed within a specified time period. If such a time period exceeds a year, approval is needed from the Department of Labor.
To prevent employers from signing multiple fixed-term contracts as a way to get around the protection given under law for permanent employment, the law names two instances where a fixed-term contract will be deemed as a permanent employment. One is where an employee continues working after the end of his fixed-term contract, without objections from the employer. The second is where employer and employee enter into a new fixed-term contract within 30 days after finishing the previous fixed-term contract, and the aggregated term of the old and the new contracts exceeds 90 days.
The information above is intended to give a general introduction only and does not constitute legal advice. If you require further assistance, please contact alicia.hsu@dentons.com.tw (August 2020)
