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Taiwan: Draft Bill on Pensions for Private School Employees

(June 5, 2009) On June 1, 2009, the Legislative Yuan (Taiwan's highest legislative body) passed the preliminary draft of a bill on retirement, compensation, severance, and resignation of private school employees, which would affect more than 60,000 teachers and staff if adopted into law. The cost to the government resulting from the bill is estimated to be an additional NT470 million (about US$14 million). (Private School Employees to Receive Pensions, TAIWAN TODAY, June 2, 2009, available at

The Ministry of Education (MOE) would help the private schools establish a corporate entity, comprising selected members of a school's board of directors and faculty representatives, to manage their pension funds. Within two months after the beginning of a semester, private high schools would be required under the bill “to deposit an amount equivalent to 3 percent of their tuition fees into special preparatory savings accounts”; for primary and secondary schools, similar accounts would be funded by “an amount equivalent to 2.1 percent of their miscellaneous fees.” (Id.)

Pension fund monies would come from faculty and staff contributions (35 percent, in future, roughly NT1,400 to NT3,600 per month, about US$43-$111); the preparatory savings accounts (26 percent), the private schools themselves (6.5 percent), and the MOE (32.5 percent). The estimated government contribution to the pension fund is over NT1.4 billion. Upon retirement, the faculty and staff would “be entitled to receive a monthly pension between NT$45,000 and NT$50,000 [about US$1,382-$1,536], thus helping to close the current gap between private and public school employees.” (Id.)