The Taichung High Administrative Court rendered the 107-Jian-Shang-35 Decision of February 11, 2019 (hereinafter, the “Decision”), holding that since the bonus for unused vacation paid by an employer for special leave based on a worker’s salary is by nature a salary for extended work hours, it should be included as an item for reported insured salary for labor insurance.
According to the facts underlying this Decision, the Bureau of Labor Insurance (hereinafter, the “BLI”), an agency affiliated with Appellant Ministry of Labor, concluded as a result of its examination that the Appellee had failed to report the insured salaries of his employees for March through April 10 of 2017 pursuant to the Insured Salary Grading Table of Labor Insurance and had underreported the insured salaries. Therefore, the Appellant rendered a disposition to impose a fine of NT$968, which is equivalent to four times of the underreported amount of insurance premium based on the results of such examination. Dissatisfied, the Appellee brought an administrative appeal and administrative action pursuant to applicable procedures. After the original trial court set aside the original disposition, the Appellant appealed.
According to this Decision, special leave is designed primarily to ensure that workers can recover from the mental and physical fatigue through proper rest and entertainment and to maintain and save the energy of workers. This is an indispensable term of labor in modern employee-management relations. Special leave dates should be negotiated and arranged between the employer and the employees. If a worker continues to work without scheduling any special leave, although this is not the scenario where the employer obtains the worker’s consent to work on leave days, still the employer does not refuse the services provided by the worker. Therefore, the worker does factually work on special leave days which should have been taken. In reference to Article 24, Subparagraph 3 of the Enforcement Rules of the Labor Standards Act effective at the time of the act, the monetary compensation payable by the employer for the special leave which should have been taken at the end of the year shall be paid based on the worker’s “wage” or “salary.” Therefore, this is sufficient to conclude that the nature of such payment is the same as the concept and criteria for double wages for work on holidays set forth in Article 39 of the Labor Standards Act. It is indeed difficult to treat such compensation as a something not derived from work. Since its nature is the wage for extended work hours, it also has the characteristics of overtime pay. Since the special leave bonus paid by a company or organization to reward its employees for their overtime work on their special leave days which are not taken has the characteristics of overtime pay, it should certainly be included as an item for reported insured salary.
It was further held in this Decision that the overtime pay for not taking leave by the Appellee, who periodically calculated the number of special leave days not taken by workers at the end of the year, is a “wage” item by nature within the meaning of Article 2, Subparagraph 3 of the Labor Standards Act. Therefore, this shall be reported as part of the monthly insured salary pursuant to relevant provisions of the Labor Insurance Statute in order to protect the workers. However, the Appellee failed to include such bonus for overtime pay for work on leave days not taken, resulting in underreporting of the insurance premium. The Appellant’s sanction of the Appellee by way of the original disposition was not inappropriate. Therefore, the original decision was reversed, and this Decision was rendered against the Appellee.