The modern principle of a constitutional state is specifically manifested by the principle of legal reservation under the Constitution.　Not only does it regulate the relations between the state and the people, but it also involves the division of powers and authorities between the executive and legislative branches.　If the people’s freedoms and rights are not restricted by a measure of Leistungsverwaltung, there should be no violation of the principle of legal reservation under Article 23 of the Constitution, which concerns the restriction of fundamental rights of the people.　If, however, any significant matter is involved, e.g., public interests or protection of fundamental rights of the people, the competent authority, in principle, should not formulate and issue any regulation without express authorization of the law (see J. Y. Interpretation No. 443).　Although the Constitution is silent as to whether the years of service for a public functionary can be combined with his or her years of service as an employee of a state-owned enterprise for the purpose of calculating his or her retirement pension, the legislature may nonetheless enact appropriate laws in this respect pursuant to the constitutional intention of ensuring the livelihood of a public functionary.　Prior to the implementation of such laws, any regulations issued by the competent authority under the authorization of the law or any relevant and reasonable rules set forth by same are not contrary to the principle of legal reservation under Article 23 of the Constitution because they are not designed to impose restrictions on the freedoms or rights of the people.　Nevertheless, it should be noted that the relevant rights and interests of a public functionary who was once an employee of a state-owned enterprise involve significant public interests and, as such, they should be appropriately prescribed either by law or by legally mandated regulations.

　　　 If a regulation formulated and issued by the competent authority under the authorization of the law is of a compensatory nature, it shall also be bound by applicable constitutional principles, including, in particular, the principle of equality (see J. Y. Interpretation No. 542).　The Examination Yuan, pursuant to the mandate of Article 17 of the Public Functionaries Retirement Act, formulated and issued the Enforcement Rules of the Public Functionaries Retirement Act and amended Article 12-III of said Rules on November 13, 1998, which provides different treatment with respect to the combination of years of service for a public functionary who was once an employee of a state-owned enterprise but later became a public functionary to whom the Public Functionaries Retirement Act applies, as distinguished from the treatment with respect to political appointees, public school education staff or military personnel, which is provided in Paragraph II thereof.　Such discriminatory provisions are rational but not arbitrary or unreasonable in that the competent authority has taken into consideration the differences between the overall design of the retirement system for employees of state-owned enterprises and that for the public functionaries to whom the Public Functionaries Retirement Act applies, as well as for political appointees, public school education staff or military personnel, including such factors as their compensatory structures, bases of retirement fund payments, compensation criteria, etc.　Thus, they are not in conflict with the principle of equality embodied in Article 7 of the Constitution.

The modern principle of a constitutional state is specifically manifested by the principle of legal reservation under the Constitution.　Not only does it regulate the relations between the state and the people, but it also involves the division of powers and authorities between the executive and legislative branches.　If the people’s freedoms and rights are not restricted by a measure of Leistungsverwaltung, there should be no violation of the principle of legal reservation under Article 23 of the Constitution, which concerns the restriction of fundamental rights of the people.　If, however, any significant matter is involved, e.g., public interests or protection of fundamental rights of the people, the competent authority, in principle, should not formulate and issue any regulation without express authorization of the law.

　　　 Article 18 of the Constitution provides for the people’s right to hold public offices, which is intended to guarantee the people’s right to perform public functions pursuant to law and hence the right to enjoy the protection of their status as such, as well as the right to claim remunerations, retirement pensions, etc.　In contrast, the state shall be obligated to provide the public functionaries with remunerations, retirement pensions and so on to maintain their livelihood.　Although the Constitution is silent as to whether the years of service for a public functionary can be combined with his or her years of service as an employee of a state-owned enterprise for the purpose of calculating his or her retirement pension, the legislature may nonetheless enact appropriate laws in this respect pursuant to the constitutional intention of ensuring the livelihood of a public functionary.　Nevertheless, so far as a measure of Leistungsverwaltung is concerned, the law allows more latitude than when any restriction on the rights or interests of the people is imposed (see J. Y. Interpretation No. 443).　Prior to the implementation of such laws, since the combination of years of service for a public functionary who was once an employee of a state-owned enterprise cannot be affected, the competent authority may, as a matter of course, issue applicable rules to follow in handling such affairs.　In deciding how to combine the years of service for a public functionary who was once an employee of a state-owned enterprise, any regulations issued by the competent authority under the authorization of the law or any relevant and reasonable rules set forth by same are not contrary to the principle of legal reservation under Article 23 of the Constitution because they are not designed to impose restrictions on the freedoms or rights of the people (see J. Y. Interpretation No. 575).　Nevertheless, it should be noted that the relevant rights and interests of a public functionary who was once an employee of a state-owned enterprise involve significant public interests and, as such, they should be appropriately prescribed either by law or by legally mandated regulations.

　　　 If a regulation formulated and issued by the competent authority under the authorization of the law is of a compensatory nature, it shall also be bound by applicable constitutional principles, including, in particular, the principle of equality.　Article 7 of the Constitution provides that all citizens of the Republic of China shall be equal before the law.　The connotation of said provision does not refer to the absolute, mechanical equality in form, but rather to the substantive equality of the people’s legal status.　In light of the constitutional value system and the legislative purpose, the legislature may take into account the nature of the matters to be regulated and thus provide rationally discriminatory treatment.　The existing laws have set forth different definitions for government employees due to the differences in their respective legislative purposes.　In order to deal with the differences in the nature of the positions of various categories of government employees, the competent authority may design different rules regarding the appointment, remuneration, reward, evaluation, retirement, and so forth for different personnel subject to different systems.　When a person is transferred from one system to another, his or her years of service cannot be directly added up.　In view of the fairness of the personnel system, a conversion system is designed for the purpose of combining the years of service.　A person who was formerly an employee of the Labor Insurance Bureau, a state-owned enterprise, is subject to the Regulation Governing the Pension and Severance Payment for Ministry-of-Finance-Operated Financial or Insurance Enterprise Employees, instead of the Public Functionaries Retirement Act.　The different designs are due to the differences between the various governmental organs in their retirement systems, bases of fund payment, as well as the calculation of benefits.　The Examination Yuan, pursuant to the mandate of Article 17 of the Public Functionaries Retirement Act, formulated and issued the Enforcement Rules of the Public Functionaries Retirement Act (hereinafter referred to as “Enforcement Rules”) and amended Article 12-III of said Rules on November 13, 1998, which provides, “After the amendment and implementation of the Act, the years of service for a public functionary may not be combined with his or her years of service as an employee of any other public office or state-owned enterprise unless the agency he or she now serves transfers the aggregate of the total value with the compound interests converted by the fund management authority upon comparing his or her seniority in office and rank with the payment criteria for public functionaries, and in turn notifies the public functionary to transfer such aggregate in one lump sum to the retirement pension fund.”　The said provision concerns the combination of years of service for a public functionary who was once an employee of a state-owned enterprise but later became a public functionary to whom the Public Functionaries Retirement Act applies, which is different from Article 12-III of said Enforcement Rules, providing, “After the amendment and implementation of the Act, the years of service for a public functionary may not be combined with his or her years of service as a political appointee, public school education staff member or military serviceman unless the paid-but-unclaimed principal and interests for his or her fund payments are transferred to the retirement pension fund.”　The said provision enables a former employee of a state-owned enterprise, like a political appointee, public school education staff member or military serviceman, to directly transfer his or her paid-but-unclaimed principal and interests for his or her fund payments to the public functionaries’ retirement pension fund upon his or her assignment to the new post, and it also recognizes his or her earlier years of service.　The logic behind the provision is that the competent authority would permit the direct transfer thereof to the public functionaries’ retirement pension fund and recognize their years of service accordingly due to its view that the designs and plans of the retirement and severance systems in respect of political appointees, public school education staff or military personnel are consistent with those concerning public functionaries to whom the Public Functionaries Retirement Act applies, and thus they are on an equal footing.