Employment Security Program    

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Scope of the Employment Insurance Program
The Employment insurance projects are divided into unemployment benefits, employment security and vocation training projects.  The program is very comprehensive and benefits employers and employees alike.  Most employers fail to utilize the programs available to them and fail to benefit from subsidized labor and training programs offered by the Employment Insurance Program.

Employment Security Benefits for Employers
The Korean Government’s policies on Employment Security are not well known.  Various agencies will work with employers to promote employment stabilization to prevent job loss, to accelerate the process of re-employment, and the expansion of employment opportunities.

The programs include:
• Employment Adjustment, a wage subsidy from 50%-66%, or 66.7%-75% in case of training and employee, for a period of up to 180 days, and in some cases longer.

• Outplacement Support, a wage subsidy from 66.7%-75% up to 12 months

• Re-Hiring Subsidy, a wage subsidy of 400,000 won per month to hire employees who were released due to an employment adjustment (such as a layoff)

• Promotional Programs for Local Employment
o Subsidy for People aged 55-60, 300,000 won per month for the first 6 months and 150,000 won for the next six months with additional benefits to the employer if their workforce is made of  more than 15% of people of that age

o Subsidy for the Employment of Women, 400,000 WON per month for 6 months for rehiring women who has retired from the company due to childbirth.  200,000 won per women who is given an additional 30 days leave for childcare. 600,000 wonper month for 6 months for hiring women who are registered heads of household and who are Single Parent Families or who must support other dependants such as their parents or sibling.

o Nursery Facilities at Work,  500,000,000 won loan at 1%-2% interest payments and a subsidy of 800,000 won per month for each Nursery Teacher.

o Subsidy for Long-Term Unemployed, 600,000 won for the first 6 months and 300,000 won for the next 6 months.

• Maternity Leave, if the women has been employed for 6 months and takes maternity leave then one month of her ordinary wage, up to a maximum of 1,350,000 and if more than 6 months, 400,000 won per month for 10.5 months.  The amount is in addition to the other mandatory maternity leave stipulated in the Labor Standards Act and it does require the consent of the Employer.

• Vocational Training, up to 80% of the costs,  90% in the case of preferred companies as designated by the Government Economic Development Programs

• Subsidized Paid-Leave Training, for employees who have been employed for more than one year, paid leave for more than 30 days with the costs of the minimum wage (120% for preferred companies) calculated on a monthly basis and the costs of the vocational training paid.

• Subsidized Development of Vocational Training Facilities, a loan covering up 90% of the construction costs at 1%-4% interest per year and up to 6,000,000,000 won.

• Vocational Training for Construction Workers,  Government paid training for Construction Workers.

Employment Security Benefits for Employees
There are many more programs for Employees but the most remarkable that Expats should be made aware of is that if a company goes bankrupt while you are an employee the government will pay you.  The government will pay up to 70% of your wages for a period of 3 months, or more, and in addition, they will pay severance.  Very few Expats apply for the benefits because the application must be made with the use of a Labor Attorney and very few specialize in Foreign Workers.  The application is an insurance policy in reality and is designed to enable the workforce of Korea to migrate to smaller companies or other high-risk ventures without fear.*

The other key programs follow:
• Tuition Subsidy, up to W1 ,000,000 for laid off workers, people over 40, or for those who have already taken information processing and are continuing their studies
• Student Loans, for insured workers entering a polytechnic collages, junior college or higher education institute at their own expense a student loan at 1% is available for higher education
• Re-employment Training for the Unemployed, when enrolled the unemployed person will receive a training allowance and a training fee
• Commission Training, there are preferential occupational training programs initiated by the Government to ensure the development of a skilled work force for the Korean Economy and when an Unemployed person or a High School Senior enters into the program the Government will provide a training fee and an allowance

K4E Editor's Note: an expat who went through this process was told (by a Korean law firm representing all the employees in a company that had shut down - Korean and foreign employees) that the program does not apply if the company has more than 300 employees and that the employer must have officially registered for bankruptcy before employees can file claims. K4E follow-up: in this area we have received contradictory information for government officials and lawyers. But the majority of respondents did not agree with the law firm's statement.

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