The Legislative Yuan has approved amendments to the 2021 Act for the Recruitment and Employment of Foreign Professionals that, among other things, extend participation in the state defined contribution (DC) pension system to non-permanent resident foreign professionals and make it easier for professionals to work and obtain permanent residency in Taiwan. The measures are intended to attract professionals and students to Taiwan to offset the impact of an aging and shrinking workforce. Separately, the Ministry of Labor (MoL) has directed that employers must contribute to the state defined benefit (DB) pension system for certain foreign manual workers.
The DC pension system under the Labor Pension Act (LPA) will cover all foreign professionals. Currently, foreign professionals are excluded from the LPA system — unless they are permanent residents or have a Taiwanese spouse — and instead are covered by the older DB pension established by the Labor Standards Act (LSA). Foreign professionals employed before the amendments' effective date can opt to remain under the LSA DB pension by submitting a written declaration within six months.
Foreign professionals with permanent residency will be eligible for certain state Labor Insurance benefits, including Unemployment Insurance (which includes parental leave benefits), and for disability and long-term care services after 10 years of insured employment.
The amendments were promulgated on September 24, 2025, and are expected to take effect in the first quarter of 2026, to be determined by the Executive Yuan.
Effective April 1, 2026, companies must contribute to the DB pension system under the LSA for foreign manual workers they have employed for more than 10 years. Currently, employers are not required to contribute to the LSA pension for foreign manual workers because the 10-year service requirement for benefits exceeds what has typically been the limit of their stay in Taiwan (six years). However, relaxation of immigration policies (with further easing expected) has enabled some foreign manual workers to lengthen their stays and qualify for LSA benefits. Foreign manual workers will remain ineligible for LPA coverage.
Employers should prepare for the introduction of the measures. Taiwan's fertility rate is among the lowest in the world and well below replacement level, resulting in a rapidly aging population and workforce. According to MoL statistics, Taiwan has 860,000 foreign workers, about 7% of the total workforce. While this is a higher rate than in South Korea and Japan (around 5% in both), it is far lower than in Australia (26%), which has a similar population size to Taiwan (Taiwan government and Australia Bureau of Statistics data).
