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Taiwan Employer of Record (Taiwan EOR)
  • By Milly Barker, PhD
  • Updated July 21, 2024
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Milly Barker, PhD
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Milly is an international lawyer and tech entrepreneur who has advised companies on expanding globally for over 5 years. She is an advocate of remote hiring and regularly consults on future of work matters. Milly founded RemotePad to help employers learn more about building and growing international teams.
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Taiwan Employer of Record (EOR)

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A Taiwan EOR (Employer of Record) is a company or service provider that assists foreign businesses in employing and managing workers in Taiwan without establishing a legal entity or setting up an in-house HR department.

A Taiwan Employer of Record (EOR) is an HR provider that enables global companies to hire in Taiwan quickly and cost-effectively.  Here we explain how Taiwan EORs work and their pros and cons as a hiring solution. 

What is a Taiwan Employer of Record?

A Taiwan EOR acts as the legal employer of record for the employees, handling various administrative tasks related to employment.

When a foreign company wants to establish a presence or hire employees in Taiwan, it can choose to work with an Employer of Record service. The EOR takes care of essential responsibilities such as payroll processing, tax withholding, social insurance contributions, benefits administration, compliance with labor laws, and other HR-related tasks. By partnering with an EOR, the foreign company can effectively outsource the administrative burden and focus on its core business activities.

By working with a Taiwan Employer of Record, foreign companies can have a streamlined and compliant approach to hiring employees in Taiwan without establishing their legal entity or setting up an in-house HR department.

The term Taiwan EOR is often used interchangeably with the term Taiwan Professional Employer Organization. 

What Services Does a Taiwan Employer of Record Provide?

A Taiwan Employer of Record typically provides services to assist foreign companies in employing and managing workers in Taiwan. These services may include:

  • Employee Onboarding. The EOR drafts compliant Taiwan labor contracts, offer letters, and other necessary documentation. They then onboard staff ensuring full compliance with local labor laws and regulations.
  • Payroll Processing. The EOR handles monthly payroll calculations, including salary disbursement, tax withholding, and social insurance contributions. They ensure accurate and timely employee payment while complying with local tax regulations.
  • Benefits Administration. The EOR manages employee benefits, such as health insurance, pension plans, and other statutory benefits required by Taiwan law. They handle the enrollment, contributions, and necessary paperwork associated with these benefits.
  • Compliance and Legal Support. The EOR keeps up-to-date with Taiwanese labor laws and regulations, ensuring that the employment practices of the foreign company align with the local requirements. They assist with compliance, including employment contracts, termination procedures, and workplace policies.
  • Tax Compliance. The EOR handles tax compliance matters related to employment, including withholding taxes from employee salaries, filing tax returns, and providing necessary tax documentation to authorities.
  • HR and Employee Relations. The EOR may support HR matters, such as employee record-keeping, leave management, and employee grievances. They can guide local employment practices and help resolve any employment-related issues.
  • Work Permits and Visa Support. If foreign employees require work permits or visas to work in Taiwan, the EOR can assist with the application process and guide immigration regulations.
  • Termination and Offboarding. When an employment relationship ends, the EOR manages the termination process in accordance with local laws, ensuring proper notice periods, severance pay, and exit procedures are followed.

It’s important to note that the specific services provided by a Taiwan Employer of Record may vary depending on the service provider and the needs of the foreign company.

Taiwan Labor Law

A Taiwan EOR takes over all labor law compliance for your Taiwan-based team, including:

1. Employment Contracts

  • Formalities
  • Employment contracts in Taiwan can be written or verbal and must clearly state the terms and conditions of employment, including job description, working hours, remuneration, and other benefits.
  • Fixed-term vs. Indefinite-term
  • Contracts can be fixed-term or indefinite-term. Fixed-term contracts are generally used for temporary or specific projects and must not exceed three years unless there are special circumstances.

2. Working Hours and Overtime

  • Standard Working Hours
  • The standard working hours in Taiwan are eight hours per day and 40 hours per week.
  • Overtime Regulations
  • Any work beyond the standard hours is considered overtime. Overtime pay is typically 1.34 times the regular hourly wage for the first two hours and 1.67 times for subsequent hours.
  • Rest Days and Holidays
  • Employees are entitled to at least one day off per week. Public holidays and annual leave entitlements are also mandated by law.

3. Wages and Compensation

  • Minimum Wage
  • Taiwan has a statutory minimum wage that is periodically reviewed and adjusted by the government.
  • Payment of Wages
  • Wages must be paid at least once per month and within a set timeframe. Employers are also required to provide detailed pay slips to employees.

4. Termination and Severance

  • Notice Periods
  • The Labor Standards Act specifies notice periods for termination, which vary based on the length of service (10 days for less than three months, 30 days for three months to one year, and 60 days for more than one year).
  • Severance Pay
  • Employees are entitled to severance pay if they are terminated without cause. The amount is calculated based on the length of service and the average wage.

5. Employee Benefits

  • Insurance
  • Employers must enroll employees in the National Health Insurance and the Labor Insurance programs, providing coverage for health, maternity, injury, disability, and death.
  • Retirement Benefits
  • Employees are entitled to retirement benefits under the Labor Pension Act, with contributions from both employers and employees.

6. Occupational Safety and Health

  • Workplace Safety
  • Employers are required to maintain a safe and healthy working environment. The Occupational Safety and Health Act mandates regular safety training and the provision of protective equipment.
  • Reporting and Compliance
  •  Employers must report workplace accidents and comply with safety regulations and inspections conducted by the government.

7. Labor Disputes and Resolution

  • Dispute Resolution Mechanisms: Taiwan provides several mechanisms for resolving labor disputes, including mediation, arbitration, and litigation. The Council of Labor Affairs (CLA) and labor courts handle these disputes.
  • Workers’ Rights Protection: Various laws protect workers’ rights, including the right to form and join labor unions and to engage in collective bargaining.

How Do You Engage a Taiwan Employer of Record?

To engage a Taiwan Employer of Record (EOR), you can follow these general steps:

  • Research and Identify Potential EORs. Look for reputable EOR service providers in Taiwan. Consider their experience, expertise, client reviews, and the services they offer. Consider one of the providers listed below. 
  • Initial Consultation. Contact the EORs you have shortlisted and request an initial consultation. During this discussion, explain your requirements, the number of employees you plan to hire, and any specific needs or concerns you may have. This consultation allows you to evaluate the EOR’s understanding of your business and their ability to meet your needs.
  • Service Proposal and Agreement. The EOR will provide a service proposal after the consultation. This document outlines the scope of services, pricing structure, timelines, and additional terms and conditions. Review the proposal carefully and seek clarification on any aspects that require further explanation. If you agree with the terms, sign the agreement to formalize the engagement.
  • Employee Information and Onboarding. Provide employee details to the EOR, including personal information, employment contracts, and any required documentation. The EOR will handle onboarding, ensure legal compliance, and set up payroll and benefits administration systems.
  • Ongoing Collaboration and Communication. Maintain regular communication with the EOR regarding any changes in employee information, updates on HR policies, or other relevant matters. Stay informed about payroll cycles, reporting requirements, and compliance obligations.
  • HR and Employee Management: Collaborate with the EOR on HR-related matters such as leave management, performance reviews, and employee relations. Seek their guidance on local labor laws and practices to ensure compliance and address any employee-related issues that may arise.
  • Termination and Offboarding. If necessary, work with the EOR to manage employee terminations and offboarding procedures, ensuring compliance with local laws regarding notice periods, severance pay, and required documentation.

It’s important to note that engaging an EOR involves a contractual relationship, and it’s crucial to carefully review the agreement and ensure you have a clear understanding of the services provided, the fees involved, and the responsibilities of both parties.

Taiwan Employer of Record Companies

Some of the leading Taiwan EOR companies include: 

  • Horizons. Based in the East Asia region, with a strong Taiwan presence, Horizons can hire and onboard employees in as little as 12 hours, both in Taiwan and throughout the world. 
  • Welcome to Taiwan. Welcome to Taiwan are Taiwan hiring specialists, also providing business registration and employee relocation services alongside their EOR offerings. 
  • Oyster. Oyster (also known as Oyster HR) are a global EOR company that can hire your employees on your behalf in Taiwan and across the globe. 

What Are the Benefits of a Taiwan Employer of Record?

Engaging a Taiwan Employer of Record (EOR) offers several benefits for foreign companies looking to employ workers in Taiwan. Some of the key advantages include:

  • Compliance with Local Labor Laws. Taiwan has specific labor laws and regulations that companies must adhere to when employing workers. EORs are well-versed in local employment laws and ensure that your business remains compliant. They handle employment contracts, payroll processing, tax withholding, and benefits administration according to local regulations.
  • Cost and Time Savings. Partnering with an EOR eliminates the need to establish and maintain your infrastructure, including legal entity establishment, HR department, and payroll systems. This can significantly save these administrative tasks time, effort, and costs. The EOR handles payroll processing, tax compliance, benefits administration, and other HR-related responsibilities, allowing you to focus on your core business activities.
  • Flexibility and Scalability. Engaging an EOR offers flexibility in scaling your operations in Taiwan. You can quickly and easily hire or downsize your workforce based on business needs without the challenges of hiring and terminating employees directly. The EOR handles the administrative processes associated with these changes, ensuring a smooth transition.
  • Risk Mitigation. By partnering with an EOR, you can mitigate various risks associated with employment in Taiwan. The EOR stays updated on labor laws, ensures proper documentation, and handles compliance-related tasks, reducing the risk of legal penalties, fines, or reputational damage due to non-compliance.

It’s essential to assess your business needs and conduct thorough research to select a reputable and reliable Taiwan Employer of Record that aligns with your requirements and provides the necessary support for your expansion or employment goals in Taiwan.

What Are the Disadvantages of a Taiwan Employer of Record?

 

While engaging a Taiwan Employer of Record (EOR) offers several benefits, there are also some potential disadvantages to consider:

  • Limited Control over HR Functions. When working with an EOR, you relinquish some control over HR functions, as the EOR becomes the legal employer of record for your employees in Taiwan. Certain HR decisions, such as hiring and termination, may require coordination with the EOR. If maintaining direct control over HR functions is essential to your business, working with an EOR may not align with your preferences.
  • Cost Considerations. Engaging an EOR involves costs, and assessing whether the benefits outweigh the expenses is essential. EOR services typically charge fees for their services, which can include setup fees, monthly service fees, and other associated costs. Evaluate the cost structure and compare it with the potential costs of establishing your legal entity and hiring in-house HR personnel to determine the most cost-effective solution for your business.
  • Geographical Limitations. EORs typically focus on specific regions or countries. If your expansion plans extend beyond Taiwan, you may need to engage different EORs or explore alternative solutions to ensure compliance and HR support in other locations.

Engage a Taiwan EOR

A Taiwan Employer of Record assists foreign companies looking to employ workers in Taiwan. While an EOR is not for every company, there are a lot of benefits, especially when it comes to cost and time savings. 

It is important that all companies choosing a Taiwan EOR company, carefully vet their potential hires and go with a Ta

Taiwan Business Guides

FAQs

Yes, engaging a Taiwan Employers of Record can be suitable for businesses of various sizes. Whether you are a small startup, a medium-sized company, or a large multinational corporation, working with an EOR allows you to navigate the complexities of employing workers in Taiwan without the need for establishing your own legal entity or setting up an in-house HR department. EOR services can be particularly beneficial for companies that do not have an established presence in Taiwan but still want to access the local talent pool and comply with local labor laws.

 

Yes, a Taiwan Employer of Record can assist with hiring foreign workers in Taiwan. They have expertise in navigating the immigration and work permit processes and can provide guidance and support in securing the necessary permits and visas for foreign employees. The EOR ensures compliance with immigration regulations and assists with the required documentation and application procedures. By working with an EOR, foreign companies can effectively hire and manage both local and foreign workers in Taiwan while ensuring adherence to the legal and regulatory requirements.
cropped Milly Barker AIV Photo
Article By

Milly Barker, PhD

Milly is an international lawyer and tech entrepreneur who has advised companies on expanding globally for over 5 years. She is an advocate of remote hiring and regularly consults on future of work matters. Milly founded RemotePad to help employers learn more about building and growing international teams.

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