6.7% of Salaried People Receive Pay Cuts Under the Pension System

Taipei, Oct. 25, 2005 (CENS)--Three months after the inauguration of the new pension system, 6.7% of local salaried people have been forced to receive pay cuts, mainly in the areas of subsidies and bonuses, according to a study of the Labor Affairs Council.

The study also shows that employees in the segments of water, power, and fuel gas, manufacturing industry, and other service industries suffered the largest scale of pay cuts. The latest category includes security, building cleaners, and manpower brokers. Human-resources specialists expect that year-end bonuses this year may not be satisfactory, due to the economic slowdown.

The study is based on a survey of 5,020 laborers.

Ninety four percent of the surveyed laborers express that their basic pays are not reduced. Those who receive the largest impact are machinery equipment operators and assemblers, non-technical workers and physical laborers. One-sided reduction in basic pay violates the law.

A manpower specialist notes that in response to the implementation of the new pension system, most businesses resorted to the reduction of welfare and bonuses.

Some 73% of laborers are unwilling to make further appropriations from their own pays for their pension funds, mainly due to the lack of extra money and low investment returns. By the end of September, of the 3.7 million laborers who choose the new pension system, only 400,000 were willing to make such appropriations, for a share of 10.8%, down from 12.5% at the beginning.