萬國法律事務所

The Financial Supervisory Commission Executive Yuan (FSC) is concerned with the amendments recently proposed for the Labor Standards Law by the Council of Labor Affairs (CLA) which would prohibit layoffs of employees during mergers and acquisitions. FSC is of the opinion that such revision limiting layoffs, if applying to financial institutions, will significantly undermine deals in achieving mergers or acquisitions, which in return may affect the development of industries and eventually have a negative impact on the employees. Thus, while FSC is expressing its opinion on the aforesaid amendments to the CLA, at the same time, it is also striving to gain approval of the amendments to the Financial Institutions Merger Act.

Currently, the Financial Institutions Merger Act provides that, when a Financial Institution undergoes a merger, reorganization, or assignment, the rights and interests of its employees shall be determined in accordance with the Labor Standards Law. To respond to the above concerns on the application of the proposed amendment of the Labor Standards Law in the cases of financial institutions, FSC proposes to amend the Financial Institution Merger Act and has designed a whole set of different principles regarding layoffs that occur in connection with or as a result of the mergers and acquisitions of financial institutions, including pension matters, severance pay for layoffs, and recognition of years of service for employees who stay in the newly formed company.