When is a wet signature required in Taiwan employment agreements?

Following our article regarding electronic signatures in Taiwan which focused on commercial agreements, this article outlines four types of employment documents that may not be executed with electronic signatures.

For people who have not yet read our article regarding electronic signatures, the basic point is that under Taiwan law, a written “wet” signature or chop is not necessarily required to form a valid contract.

Article 153 of the Civil Code states that a contract would be validly constituted if the relevant parties have expressed their intention to form a contract and agreed to all the essential terms. There is no requirement that contracts bear “wet” signatures or chops, or even be in written form.

Taiwan adopted its Electronic Signatures Act (the “ESA”) in 2001. The ESA specifically addresses the use of electronic documents, and electronic and digital signatures. The ESA basically establishes a default rule that electronic documents, electronic and digital signatures are legally valid, provided that (i) the relevant parties have agreed to the use of such electronic documents and signatures and (ii) no laws, regulations, or other requirements of government or regulatory agencies require otherwise.”

The ESA applies to most employment related documents. However, according to the authorization of the ESA, the Ministry of Labor (“MOL”, the employment regulator) has provided a list including the circumstances to which the ESA does not apply (i.e. electronic documents and electronic signatures cannot be used in those circumstances) or only applies under certain conditions.

The following four types of employment documents are those that may not be executed electronically.

1. Post-employment non-compete agreements

Post-employment non-compete agreements are required to be executed in writing pursuant to the Enforcement Rules of the Labor Standards Act. The MOL prohibits these agreements being executed electronically. Therefore, a post-employment non-compete agreement should be executed with a wet signature. If an employment agreement includes a post-employment non-compete clause, the employment agreement should also be executed with a wet signature in order to effectuate the non-compete cause.

2. Employment agreements for apprentices

Apprentices refer to a person whose objective is to learn technical skills in a job category prescribed by the labor authorities. Employment agreements for apprentice positions are required to be executed in writing under the Labor Standards Act and may not be executed electronically.

3. Employment agreements with foreign nationals in certain employment roles

Employee agreements where foreign nationals are employed in (1) marine fishing/netting work, (2) household assistance and nursing work, or (3) other works designated by the central government in response to national major construction project(s) or economic/social development needs, should be executed in writing pursuant to the Employment Service Act and may not be executed electronically.

4. Flexible work hour agreements

Under Article 84-1 of the Labor Standards Act, employers may enter into agreements with employees establishing different working hours from the Labor Standards Act requirements. These agreements should be executed in writing and may not be executed electronically.

For all the above agreements, we recommend that you preserve one original with all parties’ wet signatures on it to avoid any future disputes.

If you have any questions or require additional information on electronically executing your employment documents in Taiwan, please contact Christine Chen at cchen@winklerpartners.com.

Written August 23, 2021 By Christine Chen, Ming Teng.