Chinese Nationalist Party (KMT) Legislator Lu Chia-chen (盧嘉辰) yesterday called for changes to the Employee Welfare Fund Act (職工福利金條例). to slash benefits for employees of state-run enterprises.
Lu said he was seeking the support of other lawmakers to file such an amendment in the legislature.
The plan to amend the law follows a public outcry against the massive benefits enjoyed by employees of state-owned companies, in particular oil refiner CPC Corp, Taiwan, and electricity supplier Taiwan Power Co (Taipower).
Public anger has mounted following CPC’s raising of domestic fuel prices by between 7 and 11 percent on Monday to curb widening losses.
Although the firm is operating in the red, its employees still enjoy massive welfare benefits.
The public is even more furious, as the government is considering raising electricity tariffs to help Taipower, which said it has accumulated losses because of high energy costs.
In addition to the welfare benefits, employees of state-owned companies receive year-end bonuses of up to 4.6 months of their annual salaries.
Lu said the proposed amendment to the Employee Welfare Fund Act would focus on the amount of welfare benefits a state-owned company is allowed to assign to its employees.
It would require state-owned companies to assign 2 percent of the total salaries of their employees as financial benefits, the legislator said.
Current regulations allow state-run firms to assign a fraction of their monthly revenue as welfare funds for their employees.
Once the revision is approved by the legislature, the average benefits for CPC employees for this year would fall to NT$7,800, compared with an estimated NT$48,818 at present, Lu said.
In the case of Taipower, average benefits would drop to NT$5,583, from NT$29,926, he said.
Lu said it was no longer acceptable for loss-making state-owned companies such as CPC and Taipower to disburse massive funds as perks for their employees, as this would only further squeeze their bottom lines.
Moreover, as many state-owned companies are either monopolies or oligopolies, they generate massive revenues, making the current welfare benefit system inappropriate, he said.
He added that the welfare benefit appropriation measures had not been revisited for almost 70 years, and it was time to review the rules.
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