The impact of the minimum wage increase on your life: 5 key things you should know in 2025

With the 2025 minimum wage increase policy about to be implemented, Taiwan will usher in a year of drastic changes in wages and living costs. According to the latest announcement from the Ministry of Labor of the Executive Yuan, starting from January 1, 2025, the basic monthly salary will be increased from NT$27,470 to NT$28,590, and the basic hourly wage will also be increased from NT$183 to NT$190. This adjustment not only affects more than 2.57 million workers, but also affects multiple aspects such as corporate employment costs, labor and health insurance levels, and household consumption. The following news will help you understand the five key impacts and integrate the latest government announcements, expert opinions and actual feedback from both labor and management to help readers cope with the new changes in life brought about by the salary increase.

A full analysis of the 2025 basic wage increase

What is basic salary? Check out the latest announcement numbers at once

Basic salary, also known as the minimum wage, is the salary floor set by the government to protect the basic living standards of workers. The wages paid by employers to workers must not be lower than the standards announced by the government. If they violate the regulations, they will face legal liability and sanctions.

The following is a table showing the basic wage increase trends in recent years:

Important reminder：The basic wage is adjusted every year. Employers and HR must pay close attention to the figures released by the government and adjust wages according to the law to avoid potential fines and labor disputes.

Impact 1: Increased employment costs and operating pressures for enterprises

Adjustment of salary structure and sharp increase in salary expenditure

The most direct impact of the increase in basic wages is on corporate salary expenditures and overall personnel costs. Although large enterprises have better buffer capabilities, small and medium-sized enterprises in the chain, catering, manufacturing or retail industries must re-examine their salary structure, including readjusting the monthly or hourly wages of full-time, part-time and work-study students to ensure that all employees' wages are not lower than the statutory bottom line.

Overtime pay and allowances rise simultaneously

At the same time, overtime pay, night shift allowances and even some benefits are all calculated based on basic salary. Therefore, after the increase in 2025, these items will also be "jointly" increased, increasing the burden of personnel expenses.

The calculation formula for overtime pay in 2025 (taking weekdays as an example):

Overtime pay = hourly wage × overtime hours × overtime pay multiple
Hourly wage = monthly salary ÷ 30 ÷ 8
Overtime multiples may be based onLabor Standards Act》Adjustments at different time periods (e.g. 1.33 times, 1.66 times)

Impact 2: Labor and health insurance coverage levels are revised upward

How do the new insurance brackets affect workers?

The salary range for labor insurance and health insurance will be "automatically adjusted" based on basic salary data. Starting from 2025, the first-level insured salary will be increased from 27,470 yuan to 28,590 yuan. This means that for every minimum wage earner, the labor insurance and health insurance deductions and employer burden ratio will increase slightly.

The premium burden increases simultaneously, how to distribute it?

By 2025Labor insurance premium rate12.5% estimates that the average monthly premium per person in a general unit (average salary of 35,202 yuan) will increase by:

• Corporate employers: Increase by about 123 yuan
• Individual workers: Increase by about 35 yuan
• Government part: increase of about 18 yuan

Impact 3: Changes in the Consumer Price Index (CPI) and living expenses

As wages rise, will prices also rise?

AlthoughBasic salary increaseThe original intention of the design was to protect low-wage workers, but historical experience shows that when labor costs increase significantly, some companies will pass on the costs by "raising product prices." According to the statistics of the Directorate-General of Budget, Accounting and Statistics in recent years, after the salary adjustment in the past,Consumer Price Index (CPI)Common rising trends:

• Daily catering, transportation, daily necessities, chain retail stores
• Housing rent and food expenses

News Watch: Most economists and consumer associations suggest that the government should strengthen price monitoring to avoid the "inflation myth" where wages improve but prices soar. At the same time, grassroots families also need to plan their household expenditure budget in advance.

Impact 4: Improved protection for part-time workers and work-study workers

Salary protection for part-time and part-time workers

Starting from 2025, the hourly wages of part-time workers and working-study students will also benefit from the increase standards, and the minimum cannot be lower than 190 yuan per hour; if the actual working hours are less than the minimum monthly salary, the labor and health insurance coverage level will be declared based on the working hours and total salary.

Monthly insurance salary classification for part-time employees (some examples)

New generation of young workers directly benefit

Taking college students who worked during this summer vacation as an example, the average working hours per month are 120 hours, and the hourly wage has increased from 183 yuan to 190 yuan, which means they can receive an additional 840 yuan per month. Although the amount is limited, it is relatively helpful in subsidizing tuition and living expenses.

Impact 5: Rights and challenges of both labor and management

Employer Response and Legal Risks

according to"Labor Standards Act”, employers who fail to adjust wages on time face multiple legal risks such as fines, back pay, labor disputes, and the corporate image may also be damaged. To avoid oversights, HR experts recommend:

• Actively check official announcements and adjust salary tables immediately
• Improve the salary calculation process and regularly train HR and management personnel to be familiar with regulatory changes
• Making good use of digitalPayroll System, improve batch adjustment and data accuracy

Laborers' self-protection of their rights

Many workers said that in the past, companies failed to increase the basic wage in a timely manner, resulting in wage gaps. Experts call on workers to take the initiative to inquire about the latest salary increase information from companies and safeguard their most basic legal rights.

Comprehensive practical advice and professional resources

Open digital payroll and HR tools to assist employers and HR

Femas HR and other industry payroll systems have pre-set labor and health insurance grade templates for batch application in response to the 2025 basic wage increase, allowing companies to adjust the salary and premium grades of all employees with one click, greatly saving administrative manpower and reducing calculation errors. It is recommended that large-scale enterprises and HR make greater use of it.

Provide a checklist for both labor and management to deal with salary increases

• Adjust the salaries of all employees in a timely manner to prevent fines
• Batch check of labor and health insurance levels to ensure no one is missed
• Re-examine the calculation of overtime pay, allowances, etc.
• Consider adjusting some welfare items simultaneously
• The adjustment range/salary increase policy can be adjusted in a positive manner with employees based on the business situation

In the new era of salary environment, labor and management work together to overcome key transformations

With the implementation of the new minimum wage increase system in 2025, although challenges are coming one after another, it also brings a new wave of hope to low-income groups in Taiwanese society. Companies and employees must make good use of fair and transparent communication platforms to respond rationally to changes in the market and regulations. In addition, when you feel the positive changes in your life brought about by salary increases, don’t forget to continue to pay attention to your own rights and interests and the overall economic development of society, and jointly welcome the new era brought about by changes in prices and wages.