Premier Sean Chen today gave instructions that the year-end bonus system for state-owned firms be reviewed thoroughly, with improvement proposals due by the end of February. The review will be led by the Research, Development and Evaluation Commission (RDEC) and the Directorate-General of Personnel Administration (DGPA) in cooperation with the relevant competent authorities.
The year-end bonuses are currently composed of two parts: one based on the company's overall performance, and the other on the employee's personal performance. The RDEC and DGPA will examine whether similarities or overlaps exist among indexes for the two bonuses; the nature and definition of the two bonuses; the effect of performance rating on bonus size; disparities in evaluation ratings of employees in the same company; and how company performance may in some cases be limited or affected by government policies.
Premier Chen also approved bonuses for four state-owned firms based on the RDEC's evaluation of their 2011 performance. All under the supervision of the Ministry of Economic Affairs, CPC Corp., Taiwan Water Corp. and Taiwan Sugar Corp. received "A" ratings, while Taiwan Power Co. was rated "B."
Responding to criticism of high bonuses at some state-owned firms despite the sluggish economy and poor company performance last year, the Executive Yuan said these bonuses were based on measures and factors approved from 2011, rather than on the firms' operation results from 2012.