Following criticism of the increasing number of leased employees in various government departments, which is said to be to blame for the stagnation of wages. The Directorate-General of Personnel Administration Minister Frank Huang yesterday said he would address the issue, reports the Taipei Times.

In response to lawmakers’ questions, Mr Huang told a meeting of the legislature’s Judiciary and Organic Laws and Statutes Committee that his agency has been working with the Council of Labour Affairs to formulate a draft act to regulate companies that terminate employees’ contracts.

Citing a report of the Chinese-language magazine Business Today, Chinese Nationalist Party (KMT) Legislator Lai Shyh-bao said the number of workers employed after being referred by an employee-leasing firm increased to 570,000 last year from 70,000 in 2002.

Mr Lai said that the growth of the employee-leasing industry, which has provided companies with a convenient and flexible finance option, was a major cause of wage stagnation and that “the government has been responsible for the rapid growth of the service.”

“The government is a big client of employee-leasing firms. The Bureau of Employment and Vocational Training at the Council of Labour Affairs alone has more than 2,000 leased employees,” Mr Lai said.

“Due to the lack of rules and regulations requiring employee-leasing firms to make good on pay and benefits promised to workers they refer, the 570,000 people hired by client companies work without legal protection,” Mr Lai said.

In response, Mr Huang advised that the government’s workforce was composed of civil servants, contract and temporary workers, and leased workers. “The number of leased employees working for the government has declined from 15,514 in 2010 to 10,223 last year,” he said.

Mr Huang said that leased employees receive better pay when they are dispatched to work in the government than in most private enterprises because they receive the same benefits as civil servants.

He promised Mr Lai that his agency would look into the issue and present a report to the committee in one month. Democratic Progressive Party Legislator Wu Yi-chen, however, has demanded that the government vow to abstain from the use of leased employees before an act governing the atypical employment relations is established.

“A draft act on employee leasing companies is being formulated by his administration and the Council of Labour Affairs,” Mr Huang said.