Court Verdict Affirmed: China Steel Group (CSG) Subsidiary “China Steel Express (CSE)” Violates Law by Under-contribution of Labor Pension Fund; totaling over NT$140 million!
Union: Comprehensive Investigation, Immediate Payment, Full Reimbursement
Operating as a wholly state-owned shipping company under CSG, transporting raw materials for the CSG, CSE has long-term engaged in illegal practices. They have unlawfully under-declaring crew members' salaries under the guise of “special bonuses” in their monthly contributions to the Labor Pension Fund. This resulted in an accumulated shortfall in fund contributions exceeding NT$140 million.
In March 2021, a former employee Huang, previously served as a mechanic in CSE fleet, discovered the discrepancy in his pension fund resulting from under-declaring salary. He reported this issue to the Labor Insurance Bureau, which promptly confirmed CSE’s illegal practices. As a consequence, penalties were filed, responsible parties were publicly disclosed, and adjustments were made to Huang’s owned pension fund.
Surprisingly, CSE not only neglected to correct its actions but also wasted company resources by filing groundless lawsuits against the Bureau. Following their appeals being dismissed and a Taipei High Administrative Court ruling against them, on September 28th 2023, the Supreme Administrative Court conclusively upheld CSE's violation. This affirmed the rationales behind the Labor Insurance Bureau's penalties, ultimately concluding the entire case.
After Huang's case, the CSE Union conducted an extensive review of CSE's monthly contributions to employees' pension funds. This review reveals that nearly 500 maritime crew members have been covered by insufficient contributions made by the company. The shortfall per person varies between NT$1300 and NT$2700 depending on their roles. A conservative estimate indicates that CSE owes its current employees a total of NT$140 million over the past 15 years. If we include the former crew members who have departed, this amount could exceed NT$200 million.
In light of this, on the morning of the 14th, we will convene a press conference at the Legislative Yuan, inviting Legislator Hong Shenhan, a prominent advocate for maritime workers' rights, along with representatives from the Labor Insurance Bureau and expert scholars. During this conference, the Labor Insurance Bureau will explain the penalty rationales behind CSE's under-declaring and lower contribution employees' pension funds. The Union representatives will collectively demand that the company promptly rectify the issue by lawfully compensating and fully reimbursing all employees for their pension funds over the past 15 years.
Press Conference Time: Thursday, December 14, 2023, at 9:30 AM
Venue: Room 101, Legislative Yuan Research Building (No. 3-1, Section 1, Jinan Road, Taipei City)
Speakers:
Legislator Hong Shenhan
CSE Union President Carlos Wang
Representative from Labor Insurance Bureau
Host Lawyer Cai Qingyu, Oz & Goodwin Global Law Firm
Director Liu Meijun, National Chengchi University Institute of Labor Research
Media Contact:
CSE Union President Carlos Wang (mobile: 0966-557-709)
CSE Union Researcher Chen Baiqian (mobile: 0911-678-400)
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China Steel Express Fined for Long-term Lower Contribution of Labor Pension Funds Due to Salaries Under-Declaring
Reported by Lai Shumin and Jiang Longxiang / Taipei
Published Time: 2023-12-14 12:31 Updated Time: 2023-12-14 14:54,
Public Television Report
"China Steel Express (CSE), a company wholly owned by the state-owned enterprise China Steel Corp (CSC), recently received a final ruling from the Supreme Administrative Court for violating the Labor Pension Act by under-declaring salaries. On the 14th, legislators and the CSE Union convened a press conference at the Legislative Yuan, demanding immediate compensation from CSE for the nearly 500 employees affected by the accumulated underpaid pension funds, which amounted to over NTD 140 million in 15 years.
As a subsidiary of the state-owned enterprise China Steel Corp. (CSC), China Steel Express (CSE) handles international raw material transportation. However, the union uncovered that, each month, when CSE contributes to seafarers' pension fund accounts, the company unlawfully under-declares seafarers’ salaries under the guise of “special bonuses,” resulting in lower contributions to the seafarers’ pension funds."
Carlos Wang, President of the CSE Union, stated, “… upon reaching retirement, seafarers discovered the company had altered salary structures, converting regular wages into bonuses and special bonuses resulting in an underpayment of crew members’ retirement pension.”
The union's investigation revealed that nearly 500 maritime employees were affected. Depending on their roles, the under-declared salary per person ranged from NTD 1,300 to NTD 2,700 per month. A conservative estimate suggests that this underpayment has accumulated to more than 140 million NTD over the past 15 years.
Furthermore, the Supreme Administrative Court has upheld the ruling that CSE violated the Labor Pension Act.
Democratic Progressive Party legislator Hong Shenhan expressed, “Today's ruling is crystal clear, so I believe there's no need to further debate on this matter. We should follow the legal judgment and act accordingly.”
Jiang Lijun, Deputy Head of the Labor Pension Division at the Bureau of Labor Insurance, remarked, “Since it's a fixed amount disbursed every month, it essentially embodies a regular remuneration nature. Therefore, considering it as compensation for labor services provided regularly, it should be acknowledged as wages.”
Legislator and the labor union demanded immediate compensation from CSE for the total amount of underpaid pension funds owed to all employees due to the under-declared salaries. However, in a press release, CSE responded by stating that special bonuses are not considered in retirement fund allocations, citing compliance with the regulations of the Seafarers Act. They mentioned that any disputes related to this matter would await confirmation from civil courts before implementation.
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China Steel Express Union Questions Shortfall of Pension Funds, Considers Starting Negotiations
By Wang Yanyu and Lai Yanxi (The Central News Agency)
December 14, 2023 12:29 pm Taipei
Today, the China Steel Express Union (CSEU) raised an issue concerning the unlawful under-contribution of employee pension funds by China Steel Express (CSE). Following a thorough investigation, the union has uncovered that CSE has accrued a shortfall exceeding NTD 140 million in employees’ pension fund contributions over the past 15 years, and is strongly urging a prompt compensation to rectify this discrepancy.
CSE stated that the controversy in this case stemmed from doubts about the application of regulations. The company, while adhering to legal compliance, corporate governance, and considering both employee and shareholder interests, actively seeks a reasonable resolution with the union. In a labor-management meeting on November 27 this year, discussions were held with the union to jointly seek the most suitable solution for seafarers and prepare to initiate negotiation procedures.
The CSE Union convened a press conference at the Legislative Yuan today, revealing that in early March 2021, a seafarer uncovered the company's illicit practice of under-declaring salaries, coupled with inadequate contributions to employee pension funds. This information was promptly reported to the Labor Insurance Bureau. Within that month, the Bureau took swift action, imposing administrative penalties on CSE and disclosing the identities of those responsible.
The CSE Union stated that CSE disagreed with the Labor Insurance Bureau's penalties. After an unsuccessful appeal, the company resorted to administrative litigation. In September of this year, the Supreme Administrative Court rejected CSE’s appeal, confirming the case of unlawful lower contribution of pension funds due to under-declaring salaries.
The CSE Union questioned that after this case, upon review, nearly 500 maritime employees currently serving aboard ships have encountered situations where their retirement pension funds were under-contributed by the company. The total amount of the discrepancy for current employees exceeded NTD 140 million for the past 15 years.
The CSE Union urged CSE to immediately rectify and reimburse the entire shortfall of employees’ retirement pension funds. They also demanded that the administrative authorities actively supervise and stipulate a specific period within which CSE must compensate for the deficit.
Democratic Progressive Party (DPP) Legislator Hong Shen-han, attending the press conference, stated that since the court ruling has been issued, the employer should act according to the ruling.
CSE explained the retirement pension fund dispute of an employee surnamed Huang, who previously served as a mechanic in the Central Fleet. The dispute originated from doubts about the application of the Labor Standards Act and the Seafarers Act. The Labor Insurance Bureau considered the "special bonus" should be included in retirement fund allocations. CSE, following legal procedures, appealed to clarify the ambiguity and has already completed the payout process based on the final court ruling, amounting to thousands of NTD in compensation.
Regarding whether the "special bonus" constitutes salary items, apart from relevant administrative court rulings, there have been nine rulings in the second instance of civil courts. All these rulings concluded that the special bonus for CSE seafarers does not belong to salary items. CSE currently calculates retirement funds according to the Seafarers Act, deeming it lawful and refuting the union's claims of any illegal activities.
