Work-from-home and hybrid arrangements are now standard perks for startups competing for global talent. But flexibility on where work is done does not mean flexibility in legal compliance. Under Taiwan labor law, an employer’s obligations largely remain the same—even when employees work remotely. Poorly planned remote-work policies can expose companies to wage disputes, administrative penalties, and litigation.
This article highlights two recurring risk areas under Taiwan labor law—how attendance is recorded and how overtime is determined—and offers practical guidance for startup founders.
1. Employers Must Still Keep Attendance Records
Even for employees working from home, employers are legally required to maintain attendance records. These records must:
- Be kept every workday,
- Record working time down to the minute, and
- Be retained for five years.
In practice, this means that companies offering remote or hybrid work should implement a system that allows employees to clock in and out remotely—such as a mobile app or an online check-in system. This is not just about convenience; it is about creating defensible, auditable records that meet statutory requirements.
2. Overtime: The Hidden Risk in Remote Work
Under Taiwan’s Labor Incident Act, any working hours shown on attendance records are presumed to be working time performed with the employer’s consent. In other words, if the attendance records show overtime, the employer is presumed to have approved it—unless the employer can prove otherwise. As a result, overtime recorded in a remote-work setting can quickly translate into overtime pay liability.
It is common (and advisable) to include a pre-approval requirement for overtime in employment contracts and work rules. However, documentation alone is not enough. Courts look closely at how the system operates in reality. Employers should:
- Don’t block reasonable Overtime. If the work needs to be done, let them bill it.
- Actively remind employees to log off on time and intervene promptly when overtime occurs.
- Follow up on abnormal attendance records and require explanations or corrections where appropriate.
- Keep written or electronic records of all reminders, interventions, and follow-ups, so they can later be used as evidence.
A critical point to understand: a pre-approval system is not a “get-out-of-overtime-pay” card. Taiwanese courts consistently hold that the key question is whether overtime work actually occurred—not whether a prior application was submitted. Employers cannot refuse to pay overtime solely because the employee failed to apply in advance.
To reduce disputes—especially upon resignation or termination—we strongly recommend that employers confirm monthly attendance and overtime records with employees before payroll is finalized.
Conclusion
Remote work and flexible arrangements can be powerful tools for attracting and retaining talent, particularly for startups. But flexibility should never be mistaken for legal immunity. Before rolling out work-from-home or hybrid policies, founders should ensure that:
- A compliant timekeeping system is in place,
- Overtime risks are understood and actively managed, and
- Employment contracts and work rules are properly aligned with actual practice.
Engaging experienced counsel to review your employment documents and attendance management framework can help ensure that flexibility works for both sides—giving employees autonomy while keeping employers out of legal trouble.