Ministry of Employment and Labor Conducts On-Site Inspection of Employment Retention Subsidy Fraud... Rewards for Informants

Operation of Voluntary Reporting Period for Fraudulent Benefits from the 27th for One Month

[Image source=Yonhap News]

[Asia Economy Reporter Kim Bo-kyung] The Ministry of Employment and Labor will operate a voluntary reporting period for fraudulent claims of the Employment Retention Subsidy for one month starting from the 27th. A reward will be given to those who report fraudulent claims, and on-site inspections will be conducted for suspicious workplaces.

On the 26th, the Ministry of Employment and Labor issued a press release stating, "While continuously supporting companies' efforts to maintain employment, we will operate a voluntary reporting period for fraudulent claims from July 27 to August 28 to raise awareness among employers and prevent fraudulent claims."

The Employment Retention Subsidy is a system where the government compensates up to 90% of the suspension or leave allowance when an employer, facing unavoidable employment adjustments due to business deterioration, implements employment retention measures such as suspension or leave.

This year, due to ongoing employment instability caused by the novel coronavirus disease (COVID-19), applications and payments for the Employment Retention Subsidy have increased significantly. As of the 22nd, about 76,000 workplaces have applied for the subsidy, and a budget of 889.3 billion KRW has been disbursed.

During this period, employers who wish to voluntarily report fraudulent claims can do so at dedicated desks established at employment centers under the jurisdiction of the workplace location.

For workplaces that voluntarily report, only the amount of the fraudulent claim will be recovered, and penalty surcharges of up to five times the fraudulent amount will not be imposed.

To effectively operate the voluntary reporting period, reports of fraudulent claims will be accepted through employment centers nationwide and the Employment Insurance Fraud Reporting Center (www.ei.go.kr), and on-site inspections will be conducted for suspicious workplaces.

A reward will also be given to those who report fraudulent claims in accordance with relevant regulations.

Additionally, the Ministry of Employment and Labor is promoting institutional improvements to strengthen penalties for fraudulent claims. Through amendments to the Employment Insurance Act, criminal penalties for fraudulent claims related to employment stabilization projects have been newly established.

For intentional fraudulent claims, even if detected for the first time, amendments to the law are being pursued to impose penalty surcharges of up to five times the fraudulent amount.

Meanwhile, the Ministry plans to operate a comprehensive inspection period for fraudulent claims around September to October to further strengthen management of fraudulent claims.

Minister of Employment and Labor Lee Jae-gap stated, "We will strengthen management of fraudulent claims to ensure that the precious insurance premiums paid by employers and workers are used where truly needed," adding, "Through this, we will continue to make special efforts so that the Employment Retention Subsidy can continue to play a role in stabilizing workers' employment during the COVID-19 crisis."

This content was produced with the assistance of AI translation services.