Starting in 2018, workers will have to delay retirement by one year

Taiwan raises legal labor retirement age to 61 next year

Laborers protesting for pension rights on Labor Day. (By Central News Agency)

TAIPEI (Taiwan News)—The age of eligibility for receiving government pensions for workers born after the year of 1957 will be pushed back to 61 next year, due to changes in Taiwan's Labor Insurance Act that will become effective in 2018.

The amendments made to the act  push back retirement age for workers born in 1958 to 61, while those born in 1959 will have to wait till they turn 62.

Due to Taiwan's escalating aging population, the amendments made to the act raise the age for retirement by one year in the first 10 years and then increase by one year biennially.

In other words, the legal retirement age for pension eligibility will be raised to 61 in 2018, 62 by 2020, but 63 by the year 2022, 64 in 2024, and 65 by 2026.

Chart: Pension eligibility for Taiwanese workers

 

Birth year

Retirement age

Pension eligibility effective year

Before 1957

60

Before 2017

1958

61

2018

1959

62

2020

1960

63

2022

1961

64

2024

1962 and after

65

2026

Council of Labor Affairs Department of Labor Insurance chief Shih Fa-chi (石發基) said the government had to postpone workers' age of retirement to meet the trends of an aging society while noting other nations have also set very high pension requirements.

Before the amendments were made, laborers could receive all their pensions by the age of 55, and the new regulations were introduced to soften the impact of immediately increasing the age of retirement to 65 years old.

According to the Labor Insurance Act, workers have to be employed more than 15 years and reach the age of 60 before they are eligible for government pension funds, and receive incentives if they decide to delay retirement.

Workers can choose to delay or retire early within five years, encouraging later retirement the government is offering a 4 percent pension increase incentive for every year the laborer chooses to delay retirement.

Those choosing an earlier retirement, though, face a 4 percent pension deduction for every year they leave the workforce early.