Consumer prices to rise after new work rules implemented: premier

Premier Lin Chuan (??) conceded that consumer prices will rise after the introduction of new rules changing the structure of the work week.

Lin discussed the new rules that took effect on Dec. 23 after the Legislature revised the Labor Standards Act with a local newspaper.

Under the amended law, total maximum work time is reduced to 40 hours a week from 84 hours every two weeks, and workers are now entitled to one mandatory day off and one “flexible” rest day a week, all measures that could impact operating costs.

Employers face a major increase in overtime costs if they ask employees to work on the “flexible” day off and must provide a matching day off and overtime pay to those who work on the mandatory day off.

Lin said the revision of the law is aimed at cutting work hours, but this cannot be achieved without costs, one of which will be rising consumer prices.

He expressed the hope that the new rules will not lead to an across-the-board hike in consumer prices and said the Executive Yuan would remain vigilant over possible inflationary pressures.

Lin said the revision of the law gives laborers a better working environment. However, once work hours are reduced, companies will have to hire more workers or pay overtime to maintain production.

Corporate sector representatives have criticized the law.

Lai Cheng-yi (???), chairman of the General Chamber of Commerce of the Republic of China (Taiwan), said the new rules create a “lose-lose-lose”scenario.

Lai noted that the new law does not give workers a pay raise, increases operational costs for companies and the government knows prices will spike, but has insisted on moving ahead with the new measures regardless.

“This is a lose-lose-lose scenario. Nobody wins,” he said, adding that service-intensive sectors, such as transport, food and supermarkets will have to reduce work hours and raising prices in response to rising costs.

Long-distance bus companies may have to raise ticket prices after Chinese New Year, which falls on Jan. 28, he said.

Tsai Lien-sheng (???), secretary-general of the Chinese National Federation of Industries, echoed those sentiments, calling the new system “a rotten apple.”

Tsai said that blue collar workers in Taiwan already work fewer hours than their counterparts in the so-called four Asian dragons — Hong Kong, Singapore and South Korea.

P. F. Lin (???), chairman of Taiwan Glass Group, said he expects personnel costs to increase by between 5 percent and 8 percent under the new rules.

Lin said he hoped the government would review the impact of the law in three months and make any necessary adjustments.

Douglas Hsu (???), chairman of the Far Eastern Group, said he “would do his best not to hike prices.”

Source: Focus Taiwan News Channel