Pay Equity Taiwan

Click here for the country overview.

Basic Summary

Taiwan requires employers to provide equal pay for equal work or work of equal value without discrimination based on gender or sexual orientation. The core obligation sits in the Act of Gender Equality in Employment (AGEE), aligned with international norms such as the ILO Equal Remuneration Convention and CEDAW principles (incorporated domestically through Taiwan’s CEDAW Enforcement Act). While Taiwan does not impose a mandated gender pay gap report to government, employers are expected to prevent, detect, and remedy wage discrimination, and can be fined and ordered to correct if gaps are not objectively justified.

Total Rewards and Payroll teams should standardize compensation data in TWD, calibrate to full-time equivalent (FTE), define comparison groups by equal value, and apply appropriate statistical tests. Differences must be documented and tied to job-related factors including skill, effort, responsibility, working conditions, performance, experience, and qualifications. Personal data is protected by the PDPA; sensitive characteristics must be handled carefully, and employee privacy must be preserved in any disclosures.

Summary

Taiwan’s equal pay rules prohibit direct and indirect pay discrimination on the basis of gender or sexual orientation and require equal pay for equal work or work of equal value. The legal framework covers all employers in Taiwan, regardless of size, although additional procedural duties (such as internal measures for sexual harassment prevention) apply once the workforce reaches certain thresholds (e.g., 30 employees). Employers may differentiate pay only where supported by objective, job-related factors. Local labor authorities may investigate complaints, order corrective action, and impose administrative fines for violations; repeat or serious violations may lead to higher fines and publication of the employer’s name.

There is no centralized, recurring government pay gap reporting requirement. Nonetheless, many employers implement annual or semi-annual internal pay equity reviews and retain documentation for potential labor inspections, union or employee inquiries, and conciliation. Remedies typically include prospective salary adjustments and, where appropriate, retroactive payments consistent with wage-claim limitation periods. Data management must align with the Personal Data Protection Act (PDPA), including lawful basis for processing, minimization, security safeguards, and restrictions on sensitive data. Cross-border transfers for analytics must comply with PDPA and any competent authority restrictions.

Legal Framework

• Primary statutes and regulations
  • Act of Gender Equality in Employment (AGEE, 性別工作平等法), first enacted 2002 and amended multiple times (most recently in recent years). Article 10 prohibits wage discrimination on the basis of gender or sexual orientation and requires equal pay for equal work or work of equal value, evaluated by knowledge/skills, effort, responsibility, and working conditions (and other relevant job factors). Implementing rules provide additional guidance on evaluation criteria.
  • Labor Standards Act (LSA, 勞動基準法) and its Enforcement Rules define wages broadly as cash or in-kind compensation for work and govern working hours, overtime premiums, and wage payment requirements. Wage records and related employment documentation must be maintained for prescribed periods.
  • Employment Service Act (就業服務法) prohibits broader employment discrimination (e.g., race, class, language, thought, religion, party, place of origin, place of birth, age, marital status, appearance, disability, and others), which can intersect with pay practices.
  • Enforcement Act of the Convention on the Elimination of All Forms of Discrimination against Women (CEDAW) (性別平等教育法所涉外，另有CEDAW施行法, 2011) incorporates CEDAW principles, strengthening gender equality obligations across public policy, including labor.
  • Regulations for Implementing the Act of Gender Equality in Employment (施行細則), which elaborate on equal pay evaluation criteria and procedural matters.
  • Regulations on Work Rules under the LSA require employers with 30+ employees to establish and file work rules addressing wages, evaluations, and equal treatment.
  • Personal Data Protection Act (PDPA, 個人資料保護法, 2010; amendments effective 2015 and further revisions under consideration) governs lawful collection, processing, use, retention, security, and cross-border transfer of personal data.
• Regulatory bodies
  • Ministry of Labor (MOL) at the central level; City/County Labor Affairs Bureaus and Labor Inspection Offices at the local level investigate violations, conduct inspections, and handle conciliation.
  • Gender Equality mechanisms (e.g., the Executive Yuan’s Gender Equality Committee) set policy direction; local competent authorities administer AGEE enforcement.
• Penalties and remedies
  • Administrative orders to correct unlawful pay differentials within a set timeframe.
  • Administrative fines for AGEE violations; for serious or repeat violations, fines can reach up to approximately TWD 1,500,000, with possible publication of the employer’s name. Exact amounts depend on the violated provision and enforcement discretion.
  • Civil liability exposure (e.g., damages and wage differentials) and potential labor dispute conciliation/arbitration.
• Recent updates and trends
  • Continued emphasis by authorities on equal pay for work of equal value and anti-discrimination enforcement via inspections and conciliation.
  • Ongoing PDPA reform discussions that could increase penalties, formalize breach notification timelines, and adjust oversight structures. Organizations should monitor MOL and MOJ announcements.

Detailed Data Requirements

Field/Data	Description and Taiwan-specific notes
Employee unique ID	Pseudonymous ID for analysis; avoid using national ID numbers in analytics extracts under PDPA minimization.
Legal name (separate field)	Maintain separately from analytic dataset; use only where necessary for remediation processing.
Gender/sex marker	Required for gender pay analysis. Use the HRIS legal sex marker or self-identified gender where lawfully collected. Avoid collecting sexual orientation (sensitive data) unless necessary and with explicit consent under PDPA; equal pay analysis does not require orientation data.
Employment type	Regular, fixed-term, part-time, agency/dispatch (dispatch workers raise special comparability issues). Note if Article 84-1 special categories apply for working time rules.
Employment status	Active, leave (paid/unpaid), terminated (include last working date for prorations).
Work location	Country (TWN), city/county, site; note cost-of-labor differentials for legitimate geographic adjustments.
Job title	Local title as on contract/payroll.
Job family/function	Standardized taxonomy for comparison grouping.
Job grade/level	Global or local grade; critical for equal value mapping and regression controls.
Job evaluation points or bands (if available)	If using a point-factor system (e.g., skills/knowledge, problem solving, accountability), include total points and subfactor scores for equal value analysis.
Department/manager	For grouping, validation, and remediation routing; avoid including manager name in modeling extracts.
Hire date and company seniority	Needed for tenure; compute tenure in years with decimals.
Relevant prior experience (years)	If verified and used, include as a continuous variable; define counting rules consistently.
Education level and certifications	If job-related and consistently verified; document sources and equivalency mapping.
Performance rating(s)	Most recent and multi-year average; normalize scales across systems.
Standard weekly hours	Contracted hours to calculate FTE; Taiwan standard full-time is typically 40 hours/week.
FTE percentage	FTE = contracted weekly hours / 40 (cap at 1.0 unless policy recognizes >1.0 for overtime-exempt roles).
Overtime-eligibility status	Under LSA rules; note Article 84-1 special categories separately.
Base salary (TWD, monthly)	Contracted monthly base. If paid biweekly or daily, convert to monthly using policy-consistent methods.
Guaranteed pay elements (TWD)	Regular allowances (e.g., position/technical/hardship) paid every pay cycle. Under LSA, regular allowances are typically part of wages.
Variable cash compensation (TWD)	Commissions, incentives, discretionary bonuses. Split into target, realized, and guaranteed components; identify year-end bonus as variable unless contractually guaranteed.
Overtime pay and premiums (TWD)	Actual paid amounts; classify separately from base for clean like-for-like comparisons.
Shift/night/holiday premiums (TWD)	Capture separately; note if role requires such shifts as an inherent working condition (legitimate factor).
Allowances and benefits-in-cash (TWD)	Meal/commuting/housing if paid as cash and taxable; note whether these are wage or reimbursement (true reimbursements are not wages under LSA).
Benefits-in-kind (valuation)	Employer cost of benefits (e.g., insurance top-ups) valued at employer cost; document methodology. Statutory social insurance contributions are usually excluded from wage but may be included for total remuneration analytics.
Employer social contributions (TWD)	Labor Insurance, National Health Insurance (NHI), and Labor Pension contributions (mandatory 6% under the new pension scheme). Include in Total Remuneration view; exclude from wage-only equal pay lens.
Equity compensation	Annualized grant-date fair value (IFRS 2) of RSUs/options or realized value methodology; be consistent and document choice. Equity is not wage under LSA but is relevant to total rewards comparisons.
One-time payments (TWD)	Relocation, sign-on, retention, severance. Exclude from recurring pay gap metrics but track for transparency.
Leaves affecting pay	Paid/unpaid leave days impacting prorations.
Pay frequency	Monthly is standard; capture any deviations for standardization.
Effective date(s) of pay	For period alignment and annualization.
Currency	Use TWD; if foreign currency, include exchange rate and conversion date; store original currency for auditability.
Exclusions	True expense reimbursements, per diems, tools-of-trade, and statutory expense reimbursements (not wages). Document the legal basis for exclusion.

Step-by-Step Calculation Methodology

1. Data Standardization: Ensure all compensation elements are expressed on a consistent, auditable basis (TWD, annualized, and separated into wage vs non-wage for legal analysis).
   1. Convert all pay to TWD using a consistent monthly average spot rate for the analysis period; store rate source and date.
   2. Annualize base: Annualized_Base_TWD = Monthly_Base_TWD × 12 unless contractually fewer/more guaranteed months apply; document any guaranteed 13th month.
   3. Segregate wage elements (base plus regular allowances and guaranteed differentials) from non-wage reimbursements. Discretionary bonuses remain variable; if using expected variable, compute Expected_Variable = Target × Achievement_Factor (three-year average if available).
   4. Overtime, shift, and holiday premiums should be captured but modeled separately or controlled via hours/conditions variables to avoid biasing base wage comparisons.
   5. Winsorize extreme values (commonly at 1st/99th percentiles) to stabilize regressions; keep pre-winsorized data for audit.
2. FTE Adjustments: Normalize to full-time to make pay comparable across part-time and variable schedules.
   1. Compute FTE = Contracted_Weekly_Hours / 40.
   2. FTE-Adjusted_Base = Annualized_Base_TWD / FTE if base is stated for part-time; alternatively, Standardized_Base_TWD = Annualized_Base_TWD / FTE to reflect full-time equivalent.
   3. For hourly-paid workers, Annualized_Total_Cash = Hourly_Rate × Paid_Hours_in_Year; compute Standard_Hours_in_Year = 40 × 52 = 2,080 for comparability and derive Normalized_Hourly_Rate = Annualized_Total_Cash / 2,080.
   4. Exclude periods of unpaid leave from annualization or prorate using Effective_Dates.
3. Total Compensation Calculations: Produce multiple comparable metrics for robustness and legal defensibility.
   1. Wage-Only (LSA/AGEE lens): Wage_Only = Base + Regular_Allowances + Guaranteed_Differentials (FTE-normalized).
   2. Total Cash (annual): Total_Cash = Wage_Only + Expected_or_Realized_Variable_Cash + Overtime_and_Premiums (consider modeling Overtime separately).
   3. Total Direct: Total_Direct = Total_Cash + Annualized_Equity_Value (grant-date fair value or a policy-consistent realized proxy).
   4. Total Remuneration: Total_Rem = Total_Direct + Employer_Social_Contributions + Employer-Paid_Benefits_Valuation.
   5. Maintain consistent inclusion/exclusion rules across cohorts; calculate both uncontrolled (simple averages) and controlled (regression-adjusted) gaps.
4. Comparison Group Formation: Create groups that reflect equal work or equal value, consistent with AGEE.
   1. Primary grouping by Job Family × Grade/Level × Location (city/county) with a minimum group size (e.g., n ≥ 10) for regression; for smaller groups, use exact matching or non-parametric tests.
   2. Where grades are broad, use Job Evaluation factors (skills/knowledge, problem-solving, accountability) to ensure work of equal value comparability; consider a tolerance band (e.g., ±10% of JE points).
   3. Separate groups where working conditions materially differ (e.g., required night shifts/hazard exposure), which AGEE recognizes as legitimate differentiators.
   4. Document grouping logic and exceptions; maintain a governance record approved by HR/Legal.
5. Statistical Testing: Quantify unexplained differences and test significance.
   1. For each sufficiently large group, run OLS on log pay: ln(Pay_Metric) = β0 + β1 Female + Controls + ε. Pay_Metric should be Wage_Only (primary legal lens), and secondarily Total_Cash.
   2. Controls typically include Tenure, Prior_Experience, Education, Performance, Grade, Job_Family, Location, and Contracted_Hours (or FTE). Use robust (HC) standard errors clustered by group where appropriate.
   3. Interpret β1 as the adjusted gender effect; compute % gap as 100 × (exp(β1) − 1). Flag as significant at p < 0.05; optionally prioritize remediation above a practical threshold (e.g., >2% or >TWD 12,000 annually).
   4. For small groups (n < 10), use exact matching on Grade/Job_Family/Location and compare medians; apply Mann–Whitney U-test or t-tests as data allow; supplement with case-by-case reviews.
   5. Compute uncontrolled gaps for transparency: Uncontrolled_Gap% = 100 × (Avg_Female − Avg_Male)/Avg_Male for each metric.
   6. Validate model stability (VIF for multicollinearity, leverage diagnostics) and conduct sensitivity analyses (alternative controls, excluding outliers, alternative metrics).
6. Gap Analysis: Synthesize findings and prepare legally supportable conclusions and actions.
   1. Classify gaps by severity: Critical (significant and >5%), Moderate (significant and 2–5%), Low (non-significant or <2%).
   2. Attribute each gap to causes: structure (grading/slotting), market (location/function differentials), process (hiring/negotiation), or performance/experience.
   3. Produce a remediation plan: individual pay adjustments, structure corrections (re-leveling, range updates), process fixes (offer governance, calibration), and monitoring cadence.
   4. Prepare an audit file: methodology, data dictionary, cleaning log, model specs, results, decisions, and approvals; retain per PDPA and LSA recordkeeping standards.

Justifiable Differences

• Performance-based differentials
  • Documented and consistently applied performance ratings or objective sales/output measures. Ensure calibration consistency, written criteria, and absence of bias.
• Experience and tenure
  • Verified years of relevant prior experience and company tenure when stated in job descriptions or compensation philosophy. Maintain documented counting rules.
• Education and qualifications
  • Job-related degrees, licenses, and certifications explicitly required or preferred in job profiles; equivalency rules for international credentials must be applied consistently.
• Job grade/level and responsibilities
  • Differences due to role scope, accountability, and complexity supported by job evaluation or governance-approved leveling decisions.
• Working conditions
  • Required shifts, night/holiday work, hazardous or remote environments that are inherent to the job and compensated by premiums recognized under LSA or internal policy.
• Geographic differentials
  • Market-based location pay where labor market rates materially differ across Taiwan municipalities; maintain published differentials and periodic market review.
• Scarcity/critical skill premiums
  • Time-bound, documented premiums for hard-to-fill skills with approval trail, reviewed at least annually.
• Collective agreements
  • Pay differences mandated by a lawful collective agreement applied to covered employees.
• Compliance-driven allowances
  • Statutorily required payments (e.g., overtime premiums) or allowances required by law or regulation.

Burden of proof

• Once facts suggest a prima facie pay disparity related to gender, employers should be prepared to demonstrate that differences result from objective, gender-neutral factors tied to work requirements and consistent policy. Maintain contemporaneous documentation (job descriptions, evaluation records, performance files, market data, and approval logs).

Non-justifiable reasons

• Gender, sexual orientation, pregnancy, childbirth, caregiver status, marital status, or family plans.
• Salary history alone, prior pay at a different employer, or negotiation outcomes without objective supporting factors.
• Subjective assessments lacking written, consistently applied criteria.
• Manager preference, retention of legacy disparities without review, or reliance on unverified “market anecdotes.”
• Penalizing part-time or flexible schedules in ways not tied to actual hours or job output.
• Using non-job-related attributes (appearance, horoscope, blood type, political affiliation, etc.), which are prohibited grounds under the Employment Service Act and contrary to AGEE principles.

Reporting Requirements

• There is no mandatory periodic government submission of gender pay gap reports in Taiwan.
• Employers with 30 or more employees must maintain and file work rules with local labor authorities under the LSA; these should address wage-setting principles, evaluation mechanisms, and equal treatment to support compliance.
• In the event of a complaint or labor inspection, employers must provide requested documentation (e.g., wage tables, job descriptions, evaluation criteria, and rationale for pay decisions) within the timeframe set by the competent authority.
• Employee disclosures should protect personal data under the PDPA. Provide individual-level explanations (e.g., pay band and factors relevant to the requestor) without disclosing identifiable information about colleagues.
• Trade union/works council: Where a union exists, be prepared to engage in good-faith discussions on pay structures and provide aggregate or de-identified information consistent with PDPA and bargaining obligations.
• Public disclosure: None mandated specifically for pay equity. Voluntary disclosures should be de-identified, aggregated, and PDPA-compliant.
• Timelines: Respond to authority inquiries within the deadlines specified in the notice (commonly 10–30 days). For internal SLAs, many employers target 15 business days for employee pay inquiries and 30–60 days for internal equity reviews.

Example Employee Statement

Dear [Employee Name],

Thank you for your inquiry regarding your compensation.

[Company] is committed to equal pay for equal work and work of equal value in accordance with Taiwan’s Act of Gender Equality in Employment. Your current position is classified as [Job Family/Grade]. Compensation for this role is determined using objective, gender-neutral criteria, including the responsibilities and scope of the position, required skills and qualifications, relevant experience and tenure, performance results, and market rates for the location.

Your current base salary is TWD [X] per month, which places you at [position-in-range, e.g., 48th percentile] of the salary range for your grade in [Location]. The factors most relevant to your pay determination at this time include: [e.g., years of directly relevant experience, performance rating from the last review, and market alignment for the role].

To protect the privacy of other employees under the Personal Data Protection Act, we cannot share identifiable information about colleagues. If you believe your compensation does not reflect your role and contributions, please let us know so we can review the details with you. You may also contact [HR/Compensation Contact] at [contact] for further information. If you wish to pursue a formal complaint, you may contact the local labor authority in [City/County].

Sincerely, [HR/Compensation Lead] [Date]

Remediation Framework

• Triage and scoping
  • Validate data and confirm the gap metric (Wage_Only primary; Total_Cash secondary). Determine whether the gap is individual, group-wide, or structural (e.g., grading or market ranges).
• Root-cause analysis
  • Review job leveling, job descriptions, performance records, experience verification, and market benchmarks. Assess process drivers (offer approvals, promotion timing, compression).
• Correction design
  • Individual adjustments: Set target comp within the appropriate range considering performance and tenure; document rationale.
  • Structural fixes: Re-slot jobs, refine ranges, update differentials, and correct out-of-date market references.
  • Process controls: Strengthen hiring and promotion governance, implement offer guardrails, and require compensation review during transfers.
• Timing and retroactivity
  • Implement pay adjustments as soon as practicable, typically the next payroll cycle after approval. Where a discriminatory wage gap is confirmed, consider retroactive payments for the period affected, taking into account Taiwan’s applicable wage-claim limitation periods (commonly up to 5 years) and seek legal advice for case-specific timelines.
• Communication
  • Provide individualized, PDPA-compliant communications to affected employees, explaining the objective factors and correction. Avoid disclosing other employees’ data.
• Documentation and authority interface
  • Maintain a remediation file (findings, approvals, effective dates, payroll changes). If a competent authority ordered correction, report completion within the specified deadline.
• Monitoring
  • Re-run analyses post-remediation. Set a cadence (e.g., annual and post-cycle) and track key indicators (hiring rates vs. ranges, promotion adjustments, variable pay calibration).

Compliance Calendar

• January
  • Implement statutory basic wage changes (if announced) and refresh salary ranges; re-annualize models.
• February–March
  • Post-year-end variable pay results; run a post-bonus equity check to detect compression and discretionary bias.
• April–June
  • Annual Taiwan pay equity review (recommended): update data, re-level as needed, run models, and remediate before mid-year adjustments.
• July–September
  • Market benchmarking refresh for Taiwan locations; review location differentials and hardship/shift premiums.
• October–November
  • Budget and merit planning: embed equity guardrails and pre-/post-cycle checks.
• Ongoing
  • Within 30 days of significant organizational changes (mergers, restructures, grading overhauls), perform targeted equity reviews.
  • Maintain PDPA compliance throughout data processing and vendor engagements.

GDPR and Data Management

• Taiwan’s Personal Data Protection Act (PDPA) governs employee data. Processing must have a specified purpose and a lawful basis (e.g., fulfilling employment obligations, legal compliance, or consent where required). Define and document the purpose of pay equity analytics within HR’s data inventory and internal privacy notices.
• Collect only data necessary for analysis and avoid sensitive categories unless strictly required. Sexual orientation is sensitive; do not collect for pay equity analytics without explicit, informed consent and a strong necessity justification. Gender/sex markers should be taken from HRIS and processed minimally.
• Provide employees with PDPA rights: to access and obtain copies of their personal data, to request corrections, to demand cessation of processing or deletion where appropriate, and to withdraw consent where consent is the basis. Establish clear request channels and timelines consistent with PDPA guidance.
• Implement technical and organizational security measures proportionate to risk: role-based access, encryption in transit and at rest, pseudonymization for analytics datasets, secure data warehouses, logging, and periodic access reviews. Conduct DPIA-style assessments for new analytics projects or cross-border transfers.
• Cross-border transfers of personal data to analytics vendors or shared service centers must comply with PDPA. The competent authority may restrict transfers to certain countries/recipients to protect data subjects or national interests. Use contracts with processors that include purpose limitation, security, breach notification, and return/deletion terms; assess the recipient’s legal environment.
• Retention should align with the specified purpose and legal obligations. Maintain payroll and wage records for at least the minimum statutory periods under the LSA and tax laws; a conservative HR practice is 5–7 years. For analytics extracts, apply shorter retention and secure deletion after completion of the review and remediation.
• Breach response requires prompt action and notification to affected individuals without undue delay where rights may be impacted; sectoral rules may also require regulator notice. Maintain an incident response plan and conduct periodic drills.
• Vendor management is critical: perform due diligence, ensure PDPA-compliant processing terms, limit subprocessing without approval, and require audit rights or independent certifications.

Useful Resources

• Ministry of Labor (English portal): https://english.mol.gov.tw
• Laws & Regulations Database of The Republic of China (Taiwan) – English homepage: https://law.moj.gov.tw/ENG/
• Act of Gender Equality in Employment (English; search on MOJ database): https://law.moj.gov.tw/ENG/ (search “Act of Gender Equality in Employment”)
• Regulations for Implementing the Act of Gender Equality in Employment (English; search on MOJ database): https://law.moj.gov.tw/ENG/
• Labor Standards Act (English; search on MOJ database): https://law.moj.gov.tw/ENG/
• Employment Service Act (English; search on MOJ database): https://law.moj.gov.tw/ENG/
• Personal Data Protection Act (English; search on MOJ database): https://law.moj.gov.tw/ENG/
• National Statistics, R.O.C. (Taiwan) – Gender and labor statistics: https://eng.stat.gov.tw/
• Local Labor Affairs Bureaus (submission of work rules and handling of labor disputes): check the website of the relevant City/County Government Labor Affairs Department (e.g., Taipei City Department of Labor, New Taipei City Labor Affairs Department) for forms and contacts. There is no centralized portal for pay equity reports because none are mandated.

Important Disclaimer: This guide is based on information available as of August 2025 and is subject to change. The content provided does not constitute legal advice and is for informational purposes only. Total Rewards professionals should seek qualified legal counsel and local employment law expertise before making decisions or taking actions based on this guidance. Laws and regulations vary by jurisdiction and can change frequently. Always consult with local legal experts and relevant government agencies for the most current requirements.