In recent decades, East Asian welfare systems such as those in Hong Kong, Japan, Singapore, South Korea, and Taiwan have encountered changes in gender roles, family patterns, and demographic structure. The changes in these circumstances have brought new social problems to these East Asian welfare systems and led to demands for social policy reform (Chan, 2006; Croissant, 2004; Gough, 2004; Ku, 2003; Ku & Jones Finer, 2007; Saunders, 1996). Among these new social problems, difficulty in reconciling work and family responsibilities has become one of the most pressing issues in these countries (Peng, 2002; Sun, 2009; Sung, 2003).

Inability to achieve work-family balance could entail significant social consequences for women and the society. It could discourage women from participating in the labour market, waste the human capital of a country, and impede economic growth. If women are excluded from employment due to the difficulties in work-family balance, this could impair women’s career development and reinforce the inequality between men and women. Moreover, lower maternal employment could reduce household income, increase the incidence of child poverty, and affect child development. The inability to achieve work-family balance also could lower people’s incentives to have children and lead to the decline of fertility rate (OECD, 2007). In a word, difficulties in work-family reconciliation could have significant impacts on both the sustainability of employment and the capacity of families to provide social security and care. As pointed out by many scholars, employment and family support are important sources of social security in these societies (Gough, 2004; Jacobs, 1998; Jones, 1993; Kwon, 1997). Hence, it will be an important task for East Asian countries to deal with this issue.

The imperative to deal with the difficulties in work-family reconciliation for East Asian countries raises a prominent question: how do these countries restructure their existing welfare arrangements to respond to this problem? Many existing studies on East Asian welfare systems have pointed to the importance of families in providing care and welfare in these systems. In contrast, the role of the state in supporting families has been relatively limited (Gough, 2004; Jacobs, 1998; Jones, 1993; Kwon, 1997). However, in response to the changes in social problems, these East Asian welfare systems have implemented family policy changes in recent years. These policy changes have raised two important issues in the research of family policies and women’s roles in East Asian countries. Firstly, many existing studies that stressed families’ role in East Asian welfare systems did not include the recent development of new policies addressing new social problems. The distribution of welfare responsibilities between the state, the family, and the market in these countries could have been dramatically changed after these policy changes. For this reason, it is debatable whether previous understandings on East Asian welfare systems still hold after these policy reforms were implemented. Secondly, it is questionable whether and how East Asian welfare systems can adequately adapt to these new challenges. Chan (2007) pointed to two main crises in East Asian welfare systems: the ideological crisis and the institutional crisis. First, the dominance of productivist ideology, i.e. an ideology which puts strong emphasis on production or economic development in these countries, obstructs the development of social welfare. The first crisis contributes to the second crisis, i.e. whether the welfare institutions can respond to the needs of people. With these crises, it is unclear whether and how these welfare systems can adjust their welfare institutions to meet new social demands. Therefore, more research is needed to explore the policy changes in East Asian countries.

To fill in these gaps, this research attempts to explore how East Asian welfare systems have adapted to work-family balance difficulties in recent years. Although work-family balance could involve care not only for children but also for the elderly or the disabled, the policy discussions usually separate these different types of care (Lewis, 2009b). Childcare is an important issue in the area of work-family balance. Because of the limitation of space, this paper cannot cover all aspects of work-family balance. Therefore, this paper only attempts to address the issue of care for children. Essentially, the term ‘Work-Family Balance’ in this paper refers to the reconciliation between employment and childcare responsibilities. In general, work-family balance policies include three main policy areas: leave policies, childcare services, and flexible working time arrangements (Lewis, 2009a; Plantenga & Remery, 2005). This paper will only pay attention to leave policies and flexible working time arrangements because of the limitation of space. The leave policies discussed in this paper are only limited to the policies which facilitate work-family balance, such as maternity leave, paternity leave, parental leave, childcare leave, and other employment-related measures. However, the distinction between these leaves appears to be becoming increasingly blurred (Moss, 2009; Moss & Kamerman, 2009).

In order to explore the changes of leave policies, this research takes the development of leave policies in Taiwan as a case to illustrate how an East Asian welfare system has transformed in response to the problem of work-family balance difficulties. This paper aims to provide a detailed examination of leave policy changes in Taiwan in the past ten years. There are several advantages to choosing Taiwan as the case to explore the development of leave policies. Firstly, there has been some literature that extensively illustrated the development of leave policies in many Western welfare states. Nevertheless, the research on East Asian leave policies is relatively limited (Moss, 2009; Moss & Kamerman, 2009; Ray, 2008; Ray, Gornick, & Schmitt, 2008). For these existing studies and theories, the very different national circumstances and policy framework in Taiwan could provide new findings to increase the knowledge in leave policy transformation. Secondly, in terms of the studies on East Asian welfare systems, to some extent the Taiwanese case could be a representative case for East Asian welfare systems because Taiwan shows several features of other East Asian welfare systems (Aspalter, 2001a; Tang, 2000). Despite the fact that there are many differences between East Asian countries, the Taiwanese case indeed displays some features of East Asian welfare systems identified by scholars, such as the subordination of social policy to economic policy, reliance on families to provide care for children and the elderly, a strong state role in regulation, a tendency to adopt a social insurance principle to provide welfare, and the emphasis on education and human capital (Aspalter, 2001a, 2006; Croissant, 2004; Goodman & Peng, 1996; Gough, 2004; Holliday, 2000; Jones, 1993; Kwon, 1997; Mkandawire, 2004; Saunders, 1996; Walker & Wong, 2005). Therefore, the case of Taiwan could provide some insights into how East Asian welfare systems respond to work-family balance difficulties. Nevertheless, it should be stressed that this research does not intend to generalise the findings in Taiwan to all East Asian welfare systems. Due to complicated national circumstances and institutions, the policy making and development processes are not necessarily the same as those that prevail in other East Asian countries, and vice versa. However, the findings of this research could provide a base for further comparison between similar or dissimilar cases in the future.

The research questions that this paper will address are these: How has the Taiwanese government changed leave policies in the last decade to respond to challenges of work-family balance difficulties and the low fertility rate? How have these new leave policies changed the allocation of childcare responsibilities between the state, families, and employers? Whether, and to what extent have the Taiwanese leave policies moved towards a new pattern in terms of the allocation of childcare responsibilities? What are the important factors that influenced the dimensions of leave policy changes in Taiwan?

Through answering these research questions, this paper could contribute to existing literature in several areas. First, it could help to understand how a welfare system in the context of East Asia restructured policies to respond to changing gender roles and family patterns. Second, it could contribute to the understanding of East Asian welfare systems. This paper includes the development of leave policies in the most recent ten years. Without taking these new policies into account, it would be difficult to accurately appreciate contemporary East Asian welfare systems. Third, this paper can contribute to the understanding of leave policy development, particularly in the context of East Asia, which is usually omitted in existing literature.

This research adopts the perspective of historical institutionalism to analyse how the existing welfare system framework affects the development of leave policies. Moreover, to complement the limitations of historical institutionalism in explaining policy changes, this research incorporates the ideas of policy actors into the research framework for analysis. Kamerman and Moss (2009) have suggested that the history of leave policies has important influences on subsequent policy development. Therefore, this research adopts the perspective of historical institutionalism to explore the influences of existing institutions and policies on leave policy development. However, different from many studies in historical institutionalism, this paper does not only focus on the “lock-in” effects of existing institutions. As Kamerman and Moss (2009) have pointed out, the development of leave policies is not limited to path dependency. There are also examples of significant leave policy changes in many countries. Therefore, this paper intends to explore how existing welfare policies provide opportunities for policy changes.

Moreover, this research also includes an ideational approach in the analysis. As historical institutional approach tends to focus too much on policy continuity rather than changes, incorporating the ideas of policy actors into institutional analysis could remedy this problem (Hay, 2006; Schmidt, 2008). Therefore, this research also takes policy makers’ understandings of social problem and policy solutions into account to analyse the policy changes.

Although some studies have pointed to the influences of political parties on policy development (Aspalter, 2001b; Kamerman & Moss, 2009; Kitschelt, 2001), this paper does not adopt this approach because following such an approach would give rise to some difficulties in explaining the development of leave policies in Taiwan. In Taiwan, there are two main political parties, i.e. Democratic Progressive Party (DPP) and Kuomintang (KMT). The incumbency of the Democratic Progressive Party (DPP) between 2000 and 2008 coincided with the development of leave policies during the 2000s. Hence, it may be argued that the development of leave policies in the 2000s was due to the promotion of the DPP government. However, the findings of this research do not show sufficient evidence to support this argument. Many leave policies involve legislation in the parliament, but there is no clear evidence that the DPP had a dominant influence on related legislation in the parliament. Although the DPP was incumbent during 2000 to 2008, the alliance of the DPP was still the minority group in the parliament during this period (Lin & Chou, 2007). Moreover, the policy development under the DPP government and the Kuomintang (KMT) government did not show significant differences during the 2000s. After the KMT came into power in 2008, the KMT government also continued launching new parental leave benefit policy in 2009. The policy actors interviewed in this research also expressed very diverse opinions regarding the degree of support in leave policies from different political parties. For these reasons, this paper does not adopt the approach of party competition to explain the changes of leave policies in Taiwan.

In addition, the theory of pluralism stressed the influence of pressure groups on policy making (Dahl, 1958; Richardson & Jordan, 1985). From this perspective, it may be argued that women’s groups are an important factor that promotes the development of work-family balance policies. In the case of Taiwan, women’s groups indeed are important policy actors who have promoted leave policies. One of the women’s groups, Awakening Foundation, played an important role in advocating the enactment of Gender Equality in Employment Law and parental leave benefit policy. However, the pressures of women’s groups appear not sufficient to explain the timing and dimensions of policy changes. For instance, women’s groups have consistently advocated the formulation of a parental leave benefit policy. However, why was the formulation of parental leave benefit policy not successful in the 2002 legislation but successful in 2009? This paper argues that although the pressures of women’s groups are an important factor for the changes of leave policies, the analysis needs to include an institutional and ideational approach to explain how and when these leave policies can be changed.

This research adopts documentary analysis and interviews to investigate the changes of related policies and the policy making process. Documentary analysis is used to analyse the pattern of policy changes and policy makers’ discussions and considerations. This research examines the leave policies and flexible working time arrangements which help families to care for children under 6 years old, such as maternity leave and pay, paternity leave and pay, parental leave and parental leave benefit, and family leave. The sources of documents include related policies and laws, policy white papers, parliamentary gazettes, minutes of government meetings, government reports, publications or announcements of policy actors, and newspapers.

Moreover, in order to explore how policy makers recognised and interpreted social problems and policies, this research also involved semi-structured in-depth interviews as a research method to explore the leave policy changes in Taiwan. The researcher successfully conducted interviews with 19 policy actors who participated in the policy making in leave policies. The researcher tried to include as many different stances, interests, opinions, and perspectives in the policy making process as possible to reduce the bias of perspectives. These interviewees include government officials, non-governmental organisations, scholars, politicians, and lawyers.

The following sections will illustrate how and why the leave policies in Taiwan were transformed. This paper is divided into three parts. The first section will demonstrate the changing provisions and regulatory framework of leave policies. The focus of this section will be on the 2002 Gender Equality in Employment Law (GEEL), which provided many new regulations on leave policies. The second section will show the change of financial responsibilities and particularly pay attention to the development of parental leave benefit policy. It will demonstrate how the changes of institutions and social problems recognised by policy makers contributed to the change of leave policies in financing. Specifically speaking, the launch of Employment Insurance and the growing concern for the low fertility rate facilitated the formulation of parental leave benefit policies. Finally, there will be a synthetic analysis to conclude the overall transformation of leave policies in Taiwan.

In previous decades, the development of family policies in Taiwan was very limited and most of the care responsibilities were still taken by families. (Ku, 1997; Lin, 2006). It was argued by some scholars that the ideology of familism dominated the development of welfare policies in Taiwan (Fu, 1995; Lin, 1995; Wang & Sun, 2003). Therefore, the Taiwanese government tended to rely on family to provide welfare. It only intervened when families’ functions were not working. Under such circumstances, the provision of leave policies in Taiwan was very modest before the 2000s. However, several new leave policies and measures were launched to help parents to reconcile work and family responsibilities during the 2000s. After these policy changes, the roles of the state and employers in leave policies have been significantly strengthened.

The transformation of leave policies in Taiwan during the 2000s showed two stages of development according to the dimensions of policy changes and policy goals. First, the launch of the GEEL in 2002 changed the regulatory framework and expanded the provision of leave policies. Gender equality and female employment were main justification for policy changes during the campaign for the GEEL before 2002. The second stage of leave policy development started after the enactment of the GEEL in 2002. With growing concern for the declining fertility rate in Taiwan and the establishment of an Employment Insurance scheme that provided potential financial sources, the focus of policy change was shifted from regulation to the financing of leave policies. The main issue was moved to the provision of parental leave benefit, and it involved the reallocation of financial responsibilities in parental leave. In contrast to the first stage, the declining fertility rate became a prevalent concern to justify the policy change.

In 2002, the Taiwanese government introduced a new piece of legislation, the Gender Equality in Employment Law. The policy changes in 2002 were mostly based on regulatory measures on employers. These changes expanded the provision of leave arrangements but they did not change much in terms of the allocation of financial responsibility or resources. The main purpose of the 2002 GEEL was to prohibit gender discrimination in the workplace and provide new measures to promote gender equality, female employment, and work-family balance.

Before the enactment of the GEEL in 2002, the responsibility of leave arrangements was mostly taken by families and employers. In contrast, the involvement of the state was very weak. Such a distribution of welfare responsibilities accorded with the descriptions of some existing studies on East Asian welfare systems which stressed the importance of families and enterprises to provide care and welfare (Gough, 2004; Jacobs, 1998; Jones, 1993; Kwon, 1997). Based on the institutional arrangements of leave policies before 2002, the only statutory leave arrangements for labor in Taiwan were an 8-week maternity leave and a 4-week miscarriage leave. There was no other statutory leave arrangement available for parents to reconcile their work and family responsibilities. According to the Labor Standards Law, female workers should stop working for 8 weeks before or after childbirth. The entitlement of maternity pay was differentiated according to female employees’ contributions to employers. Employers had to pay the full amount of wages to those female employees who had been in service for 6 months. However, if the female workers had not worked for the employer for 6 months, the employers only needed to pay half of the monthly wage (Feng & Han, 2010). From the perspective of financial responsibility allocation, employers took the main financial responsibilities of maternity leave. However, for those female employees who had not worked for their employers for 6 months, half of the financial responsibility of maternity leave was transferred from employers to employees (or families).

Such institutional arrangements were perceived by some policy makers in Taiwan as important reasons that contributed to the discrimination against female in workplace and the relatively low female labor market participation in Taiwan. First, the reliance on individual employers to provide maternity pay was thought to strengthen the unwillingness of employers to hire female employees because employers might need to make extra payment when female employees took maternity leave. In order to escape these costs, some employers avoided hiring female workers or requested them to sign an agreement to leave their job once they got married or pregnant, or reached 30 years old (Awakening Foundation, 1999, 2002; Chang, 1995; Chen, 1990; Kuo, 2005; Yu, 1990). The attribution of employment discrimination to employers’ responsibility in maternity pay also can be shown in formal policy discussion meetings. In the National Conference on Taiwan’s Economic Sustainable Development, a conference organised by the Taiwanese government to collect public opinions in policy formulation in 2006, one of the policy actors pointed out that about 70% of employment discrimination cases in local governments were pregnancy discriminations. The main cause was attributed to the fact that individual employers had to pay double wages during this period (maternity pay and the wage to hire a substitute). In order to avoid such discrimination, one of the conclusions was to incorporate maternity pay into existing Labor Insurance to transfer the costs from individual employers to social insurance so that the discrimination against pregnant female workers could be avoided (Secretary of the National Conference on Taiwan’s Economic Sustainable Development, 2008b). This demonstrated that policy makers recognised the problem of employment discrimination against women was partly generated by previous institutional arrangements, i.e. the reliance on individual employers to provide maternity pay.

Second, the lack of other leave arrangements (particularly parental leave) in Taiwan was regarded by some policy makers as another important institutional reason to constrain female employment, according to interviews with several government officials and a member of parliament. After the 8 week maternity leave, there was no other statutory leave arrangement such as parental leave or childcare leave to help parents to reconcile work and family responsibilities. As a result, many women withdrew from the labor market after getting married or pregnant. According to the Women’s Marriage, Fertility and Employment Survey in 2000, for those women aged 20-49 who had working experiences before marriage, only about 40% of them kept working without break after getting married. In contrast, about 53% of them withdrew from the labor market due to marriage or childbirth. 33% of them never returned to the labor market (calculated by the author). In order to promote female employment and gender equality, expanding the provision of leave arrangements was regarded as an important way to prevent mothers permanently leaving the labour market after childbirth (Chen, 1990). According to the contention of the Awakening Foundation (1999), a women’s organisation which promoted the GEEL in Taiwan, the low female labor market participation rate in Taiwan resulted from the constraints of the traditional care role of women. Without good quality care facilities, many women had to leave the labor market to take the care responsibilities. Therefore, the Awakening Foundation argued that the responsibilities of childcare should be “socialised” to relieve the burden on women and families to achieve gender equality in employment (Awakening Foundation, 1999). The reconciliation of work and family responsibilities was thought to be an important part of promoting gender equality by women’s groups. According to the interviews with a policy consultant and a scholar involved in the legislation process of the GEEL, because of such understandings of the problems, although leave policies were separated from gender equality legislation in many countries, leave policies were combined together into the GEEL in Taiwan.

Due to these considerations, the Awakening Foundation launched a campaign to advocate the legislation of the GEEL (Hu, 2006). The GEEL was finally passed by the parliament in 2002, and it expanded the provision of leave policies. The 2002 GEEL basically kept existing regulations on maternity leave and maternity pay. In addition, it introduced several new regulations, including paternity leave, parental leave, family leave, and flexible working time arrangements. However, the legislation of the 2002 GEEL essentially shows a compromise between policy actors (mainly between women’s groups and employer groups). Although it indeed provided some new measures to promote gender equality, female employment, and work-family balance, the changes that the 2002 GEEL brought were mostly limited in regulatory measures. It involved little change in the redistribution of financial responsibilities. The role of the state in finance was still very limited and most of the financial responsibilities in childcare were still taken by families.

There have been some studies which provided explanations on why the enactment of the 2002 GEEL could be successful under the pressures of employer organisations from different perspectives, such as the advocacy of women’s groups, the need of the incumbent political party to earn the support of voters, or the changing attitudes of some enterprises in human resource management towards long-term development (Hu, 2006). These explanations may be true to some extent, but they have ignored the fact that there were many compromises in the GEEL so that the final legislation did not really increase employers’ costs much. The changes in leave policies in the 2002 GEEL were still limited, particularly in the dimension of finance. The limited changes can be shown in several aspects:

First, the duration of maternity leave and the amount of maternity pay did not change in 2002. The regulation of maternity leave in the 2002 GEEL was the same as that in the Labor Standards Law, i.e. 8 week maternity leave for mothers (Kuo, 2005; Lai, 2002). The policy formulation of maternity leave in the 2002 GEEL was largely influenced by existing regulations. As maternity leave was paid by employers, this strengthened employer’s opposition to the extension of maternity leave. Moreover, the government did not have the financial resources to cover the maternity pay. Without other funding to cover the costs of maternity pay, the duration of maternity leave and the distribution of financial responsibility on maternity pay were not changed in the 2002 GEEL.

Secondly, the development of paternity leave was limited. Before the 2002 GEEL, there was no regulation on paternity leave for workers. The 2002 GEEL granted fathers the right to take paternity leave for 2 days during childbirth. The amendment of the GEEL in 2008 further extended the duration of paternity leave to 3 days to facilitate fathers’ care for children and mothers. Regarding the payment during the course of the leave, fathers were able to receive their full wage from their employers (Kuo, 2005; Lai, 2002). Hence, the financial costs of paternity leave were also borne by employers, like those of maternity leave. However, although the GEEL placed the obligation on employers to pay for paternity leave, the 3-day paternity leave (2 days in the 2002 GEEL) with full pay did not really change the allocation of financial responsibility much. Compared to longer leaves such as parental leave or maternity leave, the 3-day payment is still very limited.

Third, the costs of family leave were still borne by employees and families. The 2002 GEEL introduced a new measure: family leave. For the purpose of taking care of a family member who needed inoculation, who suffered from a serious illness, or who encountered a significant accident, workers were allowed to take family leave for a maximum of 7 days per year. However, the course of the family leave should be incorporated into normal leave (Kuo, 2005; Lai, 2002). The wage during the course of leave thus depended on the wage of normal leave. Therefore, the costs of family leave were still basically borne by workers themselves.

Moreover, there was a restriction in employees to whom this regulation applied. Only those who worked in workplaces with 30 employees or more could take family leave. This regulation was due to the consideration of human resource management. Since small enterprises were thought less capable of dealing with the personnel arrangement, this regulation only applied to workplaces with 30 employees or more (Legislative Yuan, 2001). However, according to statistical data in 2001, only about 53% of workers worked in workplaces with 30 employees or more. It meant that almost half of the workers were not able to take family leave. Although the threshold was lowered to workplaces with 5 employees or more in the amendment of the GEEL in 2008, that still left about 20% of workers who were not entitled to take family leave after the amendment in 2008 (Legislative Yuan, 2007).

Fourth, the financial burden of flexible working time arrangements also fell on employees and families. The 2002 GEEL also granted the right to request flexible working time arrangements. If an employee had children under 3 years old and worked in workplaces with 30 employees or more, this employee had the right to ask the employer to reduce 1 working hour every day or adjust the working time. However, the reduced hour was unpaid so the workers who reduced working time for childcare had to bear the loss of income by themselves (Kuo, 2005; Lai, 2002). In other words, the costs of work-family balance were still taken by individual workers or families.

Fifth, the implementation of parental leave was an important new measure in the 2002 GEEL, but it was also unpaid. According to the 2002 GEEL, if employees had worked for their employers for one year, they had the right to take parental leave up to 2 years before their child reached the age of 3. There was no limit in gender to take parental leave so both fathers and mothers could use it (Kuo, 2005; Lai, 2002). However, as the parental leave was unpaid, there was no financial support either from employers or the government. It did not change the distribution of financial responsibilities. The lack of financial support for parental leave was an intentional arrangement to leave aside the dispute on who should pay the costs for the parental leave. The Taiwanese government was not willing to take the financial responsibilities of parental leave benefit due to its limited financial capacity. Moreover, the government was very unlikely to request employers to make the payment. As a result, parental leave was unpaid in the 2002 GEEL.

Moreover, in consideration of personnel arrangements, this regulation only applied to workplaces with 30 employees or more because these workplaces were regarded as more capable to cover the job vacancy when their employees took parental leave (Kuo, 2005; Lai, 2002). According to the official statistical data in 2001, only about half of workers could take parental leave according to the 2002 GEEL (Legislative Yuan, 2007). Hence, many workers were excluded and this dramatically limited the coverage of parental leave policies.

All in all, the introduction of the 2002 GEEL essentially only changed the regulatory framework of leave policies. Although it increased employers’ responsibilities in providing leave arrangements, it did not have much of an effect on the reallocation of financial responsibilities. The costs of taking leave were still mainly borne by either employers or employees (families). The government did not share the costs of leave arrangements. However, the changes in 2002 provided the legal base for the further development at the next stage, particularly the formulation of parental leave benefit policy.

After the changes of leave policy regulations in 2002, the focus of leave policy development moved from regulatory framework and provision to the financing of policies. Although the 2002 GEEL did not provide a parental leave benefit, it posed an obligation on the parliament to make a law to legislate the provision for a parental leave benefit. However, the obligation posed by the law was very vague and there was no reference to when the parliament should draw up and pass the law. It also did not mention who should bear the costs of the parental leave benefit. Moreover, several policy actors interviewed in this research, including government officials, a member of parliament, representatives of women’s groups, and trade unions, all indicated that when the GEEL was introduced in 2002, both employers and the government were unwilling to pay for parental leave benefit. Due to these reasons, the parliament did not make a law to legislate the provision of parental leave benefit in the first few years after the enactment of the 2002 GEEL, even if the 2002 GEEL posed such an obligation on the parliament.

However, the discussion on the parental leave benefit came into the policy agenda after the mid-2000s and the parental leave benefit was finally implemented from 2009. The parental leave benefit for labor, civil servants, and teachers was launched in 2009, and the benefit for military personnel was launched in 2010.

The implementation of these policies transferred a large percentage of financial responsibilities of parental leave from families to employers and the state. The parental leave benefits for labour, civil servants, and military personnel are provided through existing social insurance schemes: Employment Insurance, Civil Servant and Teacher Insurance, and Military Personnel Insurance. For those employees who participated in these social insurance schemes, the insurance funds provide 60% of income replacement rate for 6 months to each parent who takes parental leave. Hence, the maximum parental leave benefit can reach 1 year if both parents take the leave. The distribution of financial costs depends on the regulation of insurance schemes. For labor, as the premium of Employment Insurance is shared by the government, employers, and employees, the costs of parental leave are therefore shared by the three parties accordingly. Although the distribution of premium varies according to workers’ occupation statuses, in general the shares of the financial burden are employers, 70%; employees, 20%; and the government, 10%. As a result, employers have to pay 70% of the costs of parental leave benefit and the government is responsible for 10%. For civil servant, public school teachers, and military personnel, the government shares 65% of the premium and the employees have to pay 35 % of the premium. For private school teachers, the government and the private schools (employers) pay 32.5% of the premium each. Employees have to pay 35% of the premium.

In the second stage of leave policy development, the dimension of policy changes moved from regulation to finance. Compared to the development at the first stage, the second stage change reallocated the financial responsibilities of leave arrangements. It raised a question as to what factors contributed to such a development.

Why could the parental leave benefit not be introduced in the 2002 GEEL but could be successfully implemented in 2009? The findings of this research suggest that two important factors made the provision of parental leave benefit possible in 2009. Firstly, the change of institutional structure provided the potential financial resources for the parental leave benefit. In 2002, due to the lack of financial resources, it was difficult to reallocate the costs of parental leave. With the constraints of government expenditures, the Taiwanese government was unwilling to pay for the parental leave benefit. Moreover, employers strongly opposed the expansion of leave policies. Therefore, it was very unlikely that employers would be willing to make payments for the parental leave benefit. Although the 2002 GEEL posed an obligation on the parliament to legislate for the parental leave benefit, there was no financial resource available in the first few years after the GEEL was enacted. However, the launch of Employment Insurance in 2003 provided the potential funding to implement a parental leave benefit policy. With the low unemployment rate in Taiwan in the past few years, the Employment Insurance Fund had accumulated a large amount of surplus from 2003. This surplus gave policy makers potential financial resources to convert existing institutions to meet new demands.

The second factor involves the transformation of problems recognised by policy makers. Kamerman and Moss (2009) has indicated that demography is an important consideration which affects the formulation of leave policies. The findings of this research also suggest that the growing concern for low fertility rate to some extent facilitated the formulation of the parental leave benefit in Taiwan. As pointed out by a government official and a member of a women’s group, in the previous stage of leave policy development before 2002, promoting gender equality and female employment rate were important justification which drove the formulation of the 2002 GEEL and leave policies. It was believed by some policy makers that the provision of leave policies would be helpful to keep women in workplaces and reduce the withdrawal from employment for childcare. During this period, the emphasis on raising fertility rate was relatively lower, if it existed at all. Several policy actors involved in the formulation of the 2002 GEEL acknowledged that when they were formulating the bill of the GEEL before 2002, the fertility rate was still not an important consideration. However, the rapid decline of the fertility rate in recent years raised extensive worries for the sustainability of the economic development and welfare system. The fertility rate in Taiwan showed a rapid drop in the 2000s. The fertility rate in Taiwan declined from 1.7 in 2000 to 1.1 in 2005 and 1.0 in 2009 (Department of Statistics, 2011) (Table 1). With the fast change in fertility pattern, although gender equality and female employment were still part of the arguments to support leave policies in the policy formulation process, the concern for the fertility rate had become one of the most important justification to promote leave policies, particularly the parental leave benefit after the mid-2000s.

[Table 1] Total fertility rate

Total fertility rate

The desperation of the government and policy makers to deal with the problem of the declining fertility rate can be demonstrated in several important government conferences and policy documents. In 2006, the Taiwanese government organised a national conference to address the significant problems that challenged the society of Taiwan and formulate appropriate strategies to respond to these challenges (Secretary of the National Conference on Taiwan’s Economic Sustainable Development, 2008a). 175 people were invited to participate, including government officials, entrepreneurs, politicians, scholars, and representatives from various social groups. In this conference, the problem of the declining fertility rate was recognised as one of the five most important social security issues on the agenda. The participants of this conference suggested that the problem of the low fertility rate in Taiwan could be addressed by providing a parental leave benefit that would share part of the costs of childcare (Secretary of the National Conference on Taiwan’s Economic Sustainable Development, 2008a). This suggestion was later adopted as a formal policy and proclaimed in government official documents such as the “Great Warmth Social Welfare Package” and “Demographic Policy White Paper” (Ministry of the Interior, 2008; Ministry of the Interior, Ministry of Education, Council of Labor Affairs, & Department of Health, 2006). From a series of national conference and government publications, it can be found that the development of leave policies in recent years was strongly justified by the concern for low fertility rate.

The change of focus from gender equality to low fertility rate to some extent changed the political power between social groups that supported and opposed the parental leave benefit. In the legislation process of the 2002 GEEL, as the main policy goals were gender equality and female employment, some policy actors regarded the leave policies as policies that mainly favored women or working parents. Given that the political bargaining power of this group was not particularly strong, it was very difficult for the policy actors who promoted the parental leave benefit to put this benefit into the 2002 legislation. As indicated by a government official involved in the policymaking, the redistribution of financial resources could involve stronger conflicts of interests than increasing the regulation level. It would need more power to propel the redistribution of financial responsibility. With insufficient political power, women’s groups have difficulties in introducing reforms that involved significant resource redistribution and the rearrangement of financial responsibility. Due to the inability to redistribute financial responsibilities of leave policies at the first stage of leave policy development, policy makers who promoted leave policies made many compromises to facilitate the passage of the 2002 GEEL. The addition of the article that posed obligation on the parliament to make a law on parental leave benefit was an example. It demonstrated that although some policy actors(mostly women’s groups) had indeed intended to introduce parental leave benefit into the 2002 GEEL, their power was not sufficient to put it into practice. Therefore, they only could insert this article to facilitate the policy changes in the future. With the strong opposition from employer groups, the 2002 GEEL only could provide working parents parental leave without payment to cover the course of leave.

However, after the concern for declining fertility rate was raised, the legitimacy of parental leave benefit was dramatically strengthened. The decline of fertility rate was thought to lower the number of working population in the future, increase the burden to care for the elderly and children, and reduce the tax revenue (Ministry of the Interior, 2008). It was recognised as a common problem for the whole society and the welfare system. Compared to gender equality and female employment, slowing down the declining fertility rate was thought beneficial to whole the society rather than some specific social groups. In order to avoid these problems, the legitimacy of the parental leave benefit became much stronger. According to the minutes and conclusions of the National Conference on Taiwan’s Economic Sustainable Development, the parental leave benefit was believed by many policy actors to be helpful to increase the incentives to give birth to children and slow down the trend of declining fertility (Secretary of the National Conference on Taiwan’s Economic Sustainable Development, 2008b). Thus, the parental leave policy was no longer regarded as a policy that only benefitted certain groups such as working parents or female workers but as one that benefitted the whole society. For instance, one of the justifications to promote work-family balance policies (including leave policies) in the National Conference on Taiwan’s Economic Sustainable Development is that such policies help preserve the stability of the demographic structure and improve the dependency ratio to prevent or relieve many negative social impacts in the future, such as care for the elderly, shortage of labour force, and decline of tax revenue (Secretary of the National Conference on Taiwan’s Economic Sustainable Development, 2008b). With this change, the claim to formulate parental leave benefit was highly justified and public support for the parental leave benefit was much reinforced. Hence, the government could implement policies with stronger redistributive effects (such as parental leave benefit which reallocates the financial responsibilities of childcare), policies that had been very difficult achieve in the 2002 GEEL legislation process. It should be noted that in the policy making process of the parental leave benefit, employers in general still opposed the provision of the parental leave benefit as they did in the legislation process of the 2002 GEEL (Lin, 2008; Tan, 2008). However, despite the opposition from employers, the Taiwanese government finally adopted the policy suggestion of the National Conference on Taiwan’s Economic Sustainable Development in 2006 and formulated the parental leave benefit policy. This shows a very different pattern and logic from that in the first stage of leave policy development before 2002.

Because of the transformation of institutional structure and policy goals, the changes of leave policies in Taiwan have moved from regulatory measures and provision of leave arrangements to reallocation of financial responsibilities. With the implementation of the parental leave benefit, the financial responsibilities of families have been significantly relieved.

Broadly speaking, the development of leave policies in Taiwan in the last 10 years shows increasing roles of employers and the state to provide welfare. Nevertheless, these changes took place in different policy dimensions. Seeleib-Kaiser (2008) has pointed out that the transformation of welfare states is not a simple process. Rather, the changes of welfare states are multi-dimensional, which may result in different directions and levels of change in different policy dimensions such as provision, regulation, and finance. This section will analyse the changes of leave policies in Taiwan in these three dimensions.

In terms of the provision of leave policies, the responsibilities of employers were strengthened. Before 2002, employers only needed to provide maternity leave and miscarriage leave. However, after the introduction of the GEEL in 2002, employers had to provide more leave arrangements including paternity leave, family leave, parental leave, and flexible working arrangements to their employees. Moreover, the coverage of family leave and parental leave was expanded to smaller enterprises in the amendment of the GEEL in 2008. Hence, more employers are now required to provide leave arrangements.

With regard to the level of regulation, the role of the state in regulation in leave policies has been enhanced. The enactment of the GEEL in 2002 and the amendment in 2008 strengthened the regulation on leave arrangements. It posed more obligations on employers to provide leave arrangements and payment to cover the course of leave.

From the perspective of financial responsibilities, the changes of leave policies mostly transferred the responsibilities of care from families to employers and to a much lesser extent to the state. The responsibilities of employers in paternity pay were increased. Moreover, the most important change was the introduction of the parental leave benefit. Through the mechanism of existing social insurance schemes, in general employers have to take 70% of the financial responsibilities in parental leave. The state also needs to take 10% of the financial responsibilities. For civil servants, public school teachers, and military personnel, the government has to take 65% of the financial responsibilities. For private school teachers, the government and private school (employer) each shares 32.5% of the financial responsibilities. Compared to leave policies before 2009, the financial burden of families in taking parental leave has been much relieved, at least at the policy level. Overall, the changes in leave policies in the 2000s demonstrated the increase of state intervention.

This paper has examined the development of leave policies in Taiwan during the 2000s. With the changes in gender roles, family patterns, and demographic structure, the policy makers have gradually recognised the difficulties in work-family balance as an important social problem. Therefore, the Taiwanese government has introduced policy changes in leave policies to address these problems. Although East Asian countries have tended to rely on families to provide welfare and care (Croissant, 2004; Goodman & Peng, 1996; Jones, 1993), this paper shows that this tendency appears to be changing. With the policy changes in Taiwan in recent ten years, the role of the state in leave policies has been strengthened.

The development of leave policies in Taiwan shows incremental changes and it can be generally divided into two stages according to the dimensions of policy changes. At the first stage, the changes mostly involved provision and regulatory framework. The enactment of the GEEL in 2002 introduced several new regulations on employers to provide paternity leave, family leave, parental leave, and flexible working time arrangements. At the second stage, the dimension of policy change moved to the reallocation of financial responsibilities, particularly the implementation of the parental leave benefit. In this process, a large percentage of financial responsibilities have been transferred from families to employers and the state. There were two important factors that made the reallocation of financial responsibilities feasible in the second stage. Firstly, the launch of the Employment Insurance provided the financial resources for policy makers to convert existing institutions to meet new needs. Secondly, the growing concern for the low fertility rate in Taiwan strengthened the imperative to redistribute financial responsibilities in leave policies to address this problem.

After the policy changes in the 2000s, the responsibilities of employers in providing leave arrangements have been expanded. The state also strengthened its role in regulation. In terms of the dimension of finance, a large percentage of financial responsibilities have been transferred to employers and the state, mainly through the adoption of existing social insurance schemes. Overall, the pattern of leave policies in Taiwan is shifting from a stress on family responsibilities towards more employer and state responsibilities.