Lately,it has been heard that, due to the decrease in orders and the continuousdecline in profits, some technology companies have asked their employees to “workless and take more vacations.” In addition to requiring their employees to usetheir paid leave in the first quarter, lately, it is even heard that they furtherrequire their employees to have “dream realization leaves” and “work-relatedleaves.” While the stated reason is that employees may use a longer leave to goback home towns and visit their families or to go abroad to “realize theirdreams,” the real reason might be to reduce labor costs. This has evokedcontroversies.

Firstof all, the purpose of the provisions in the Labor Standards Act on annual paidleaves is to provide an opportunity for rest and restoration for the employeesso that they may be relieved of the stress from work and protect their socialand cultural life. Regarding the arrangement of annual paid leaves, theprovisions were amended in 2016 from the original “arranged through thenegotiation between the worker and the employer” to “arranged by the workers.”Therefore, the dates of annual paid leaves are to be arranged by workers, but theemployer, however, in light of urgent needs of the business operation, mayconsult and make adjustments with workers. An employer cannot unilaterallyassign workers the dates for their annual paid leaves or require workers to usetheir annual paid leaves before a certain date, or else it would be at risk forviolating the law.

Secondly,the so-called “dream realization leaves” and “work-related leaves” are notleaves provided by the law. In the past, businesses have introduced leaves suchas “administrative leaves” and “special leaves.” With respect to such leavesthat are not leaves defined by the law, whether the worker is paid during theleave, the percentage of salary paid, and whether health insurance or pensionis paid by the employer all depend on the circumstances of each case. Overall,unpaid leaves or the aforementioned “dream realization leaves” invented bybusinesses are all leaves out of the employer’s consideration of the businesssituation for the purpose of reducing labor costs, hoping that employees would“work less and rest more” so that they can reduce (or stop) wage payment totheir employees.

However,a worker’s working time and salary are the most basic and important elements ofan employment contract. If a business has the need to reduce labor costs, itshould negotiate with its employees and obtain their consent before reducingtheir working hours and wages. In addition, courts in Taiwan have long heldthat employees are economically unfavorable. The mere fact that employeesremain silent and do not express objection does not mean that they have impliedtheir consent to the unfavorable change in the employment contract. Forexample, even if an employee does not object to a deduction in wages when he orshe receives his or her paycheck, the employee’s mere silence does not meanthat the employee has implied his or her consent to the wage reduction.Businesses should pay special attention to such situations.

Insummary, businesses should not arbitrarily and unilaterally arrange annual paidleaves for employees, nor should they force their employees to take a break andreduce their wages for any stated reason. If an enterprise wants its employeesto take annual paid leave as much as possible, it should take the approach to remind,encourage, or promote them to do so. If there is a need for employees to reducetheir working hours in order to reduce their salaries or to take leave withoutpay, the employer should discuss it with the employees and hope that they will sharethe difficulties together. It should never act arbitrarily and should alwaysobtain the employee’s consent before proceeding.

Employeesare essential to the survival and development of a business. Simply reducinglabor costs may cause employees to question their value to the company, whichis not a wise move in the long run. How to strike a balance between theinterests of employees, shareholders, and customers, achieve the goal ofsustainable business operation, and avoid labor disputes depends on the wisdomof business owners.

Thisarticle was published in the Expert’s Commentary Column of the CommercialTimes. https://view.ctee.com.tw/business/49914.html