FENC is fully aware that maintaining work-life balance, promoting health and well-being and facilitating flexibility at work are of vital importance for employees. While focusing on hardware and software refinement and building a friendly and safe workplace, the Company is helping employees thrive without worries through its robust remuneration and welfare policies. The comprehensive measures include parental leave, family care leave, contracted child care services and breastfeeding rooms. Whether employees are the primary caregiver in the family or not, six months of leave without pay are available. While employees benefit with the assurance of job stability after their families are well cared for, the Company also benefits by enticing and retaining top talents. 

Compensation

FENC established a variable payroll system that rewards long-term individual and team performance. The Articles of Incorporations stipulates that 2%-3.5% of the Company’s net profit shall be dedicated toward employee compensation. Please refer to this page “Performance Management Appraisals” for details. The Company provides long-term incentives for employees below the senior management level. According to the FENC Articles of Incorporation, 2% to 3.5% of profits from the current year should be distributed as employees’ compensation. During a profiting year, all employees without demerits are entitled to this long-term incentive provided through a year-long mechanism. Company- and Business-wide performance is taken into consideration for determining the monthly and annual employee bonuses. For production bonuses, additional consideration includes the actual output rate, scrappage rate, quality, energy as well as occupational safety. The bonus system is a means to encourage all units to ensure occupational safety and protect the environment through energy conservation, carbon reduction and recycling, and to incentivize employees to optimize the production flow and fully embody corporate sustainability.

Managers from mid-level upwards and senior employees in Taiwan may participate in the employee stock ownership plan (ESOP), which purchases Company shares systematically with 15% contribution from the Company. A trustee manages the shares and calculates the trust property equity. Upon termination of employment, employees may redeem the investment in the form of stocks or cash. ESOP offers a long-term option for employee bonus and investment returns. In 2023, 91% of employees with ESOP eligibility have joined the plan, indicating a high willingness to participate among employees.

Compensation for executive levels above assistant vice president is based on corporate performance and the market average. In addition, the compensation is adjusted based on performance appraisal and factors in future operational risks. The Company does not offer signing or recruitment bonus for senior managers. Considerations for compensation of other employees include overall corporate and departmental performance; pay rates among listed companies; market survey provided by professional consulting firms; overall financial and management risks. Stock options are not available for regular employees, and the company policy does not include deferred or vested share options.

The remuneration policy for the Board members and managers is discussed during the Remuneration Committee meeting, which is convened by the independent Board members. The discussions are presented for Board approval and results are presented at the shareholder meeting. Please refer to “Sustainable Management” for details.

The main factor behind the gender pay gap at FENC is tied to the gender group with specific skill sets required for certain industries. FENC sites in Taiwan and mainland China are mainly in the mid- to up-stream industries with high reliance on the chemical technology, a field where male employees tend to outshine female staff and hence, they are better paid. Sites in Vietnam are seeing a shrinking pay gap between male and female employees and managers as the skills gap narrows among workers. Additionally, bound by traditional social roles, females are largely responsible for taking care of the household, and the record shows a higher percentage of male workers willing to work overtime, hence better paid than their female counterparts. FENC sites in Japan has been focusing on cultivating female executives, resulting in a slightly higher average salary among female managers.

There is a gender difference among different industries within FENC’s industry chain. However, gender strengths are also reflected in the salary level, which is a reflection of the Company’s fairness in performance appraisal.

Salary Ratio by Gender

Gender Pay Gap by Employee Level

Gender Pay Gap Comparison

Salary Comparison to Market Level

Salary Comparison to Minimum Wage by Gender

Ratio of Salary and Ratio of Salary Increase Between the Highest Salary and Median Salary 

Performance Management Appraisals

FENC has a clear set of regulations governing the performance management appraisals to help employees improve work capabilities and performance, discover growth opportunities and develop career potential. The performance management appraisals policy and criteria, which take corporate and personal performance into consideration, are transparent. For employees at different levels, ESG performance, such as energy conservation, promotion of green business, R&D of green products, implementation of corporate governance and optimization of human resources, is incorporated into the performance management appraisals. FENC provides a performance-driven bonus system to incentivize top-performing employees and executive managers. The performance management appraisals system covers 100% of permanent employees at FENC and does not include part-time employees and employees under one year of employment or on leave without pay. The 2023 performance management appraisals reached a 100% completion rate among permanent employees.

Performance Management Appraisals for Employees

Productivity-linked incentive is issued based on business operation as well as departmental and personal performance. Twenty percent of employees’ monthly salaries come from this incentive system. Indicators for the incentive include productivity milestone, quality, environment and occupational safety, which encourage employees to engage in improving occupational safety; energy and carbon reduction; environmental protection and recycling; production flow, and ultimately help FENC achieve sustainable management.

The performance management appraisals for employees is conducted at least once a year and serves as a key reference for salary adjustment, bonus, promotion and dismissal.

Performance Management Appraisals and Employee Development System

Evaluation Categories and Details for Senior Managers

Performance management appraisals for senior managers is 70% quantitative, which is based on revenue analysis, and 30% qualitative, which is based on long-term development. The review is tied to adjustments in salary and annual bonus.

Evaluation Categories and Details for Senior Managers

Performance Management Appraisals for Migrant Workers

Performance management appraisals for migrant workers in Taiwan are determined by their supervisors based on monthly attendance and production of Grade A products. Bonus is awarded based on the results.