With the changes in Taiwan’s demographic structure, the labor supply has been impacted, making compensation an even more critical factor in attracting and retaining talent within organizations. Elements such as employee motivation, retention rates, talent acquisition, and reducing turnover intention are all closely tied to salary.

The salary structure forms the foundation of compensation composition, which is based on “salary items”—in simple terms, the detailed components listed on a payslip, including wages, benefits, and bonuses. The Labor Standards Act provides definitions for “wages” and “benefits.”

As such, the design of salary structures and benefits planning is typically regarded as a strategic aspect of human resources, playing a crucial role in the short-, medium-, and long-term development of a company.