Over 20,000 Cases of Unemployment Benefit Fraud Annually... Payment Restrictions Up to 3 Years

Deliberation and Resolution of 'Enforcement Decree of Employment Insurance Act' at the State Council
If Fraudulent Claims Occur 5 or More Times in 10 Years, Benefits Are Suspended for 3 Years
Employment Centers Deduct 10% of Job-Seeking Allowance for Refunds and Collection Fees

Asia Economy DB=Photo by Hyunmin Kim kimhyun81@

[Asia Economy Reporter Kim Bo-kyung] To prevent more than 20,000 cases of fraudulent unemployment benefits (job-seeking benefits) claims annually, the government has introduced new measures. Those who repeatedly commit fraud will be denied job-seeking benefits for up to three years.

The Ministry of Employment and Labor announced on the 25th that the Cabinet reviewed and approved the "Amendment to the Enforcement Decree of the Employment Insurance Act" and the "Enforcement Decree of the Act on Support for Industry-Academy Work-Learning Dual System." Both decrees will take effect from the 28th.

The Enforcement Decree of the Employment Insurance Act includes specific provisions of the amended Employment Insurance Act, which stipulates that those who have fraudulently claimed job-seeking benefits three or more times will be denied benefits for up to three years.

If a person has committed fraud three times in the past ten years, they will be denied benefits for one year; four times, two years; and five or more times, three years.

However, the newly introduced measure focuses more on preventing repeated fraud rather than eradicating fraudulent claims altogether. There are no special sanctions for those who have committed fraud one or two times.

According to the office of Kim Woong, a member of the Future United Party, the number of fraudulent job-seeking benefit claims in the past four years has reached about 20,000 to 30,000 cases annually. In 2016, there were 28,900 cases; in 2017, 33,600 cases; in 2018, 25,600 cases; and last year, 22,000 cases. In the first half of this year (January to June), there were 12,300 cases, and it is expected to exceed 20,000 cases by the end of the year.

The amount of fraudulent claims to be recovered and additional collections by the Ministry of Employment and Labor reaches 40 billion KRW annually, but in practice, many cases are not properly recovered. The recovered amount decreased from 34.38 billion KRW in 2018 to 32.99 billion KRW last year. The amount recovered in the first half of this year reached 13.46 billion KRW.

The amendment to the Enforcement Decree of the Employment Insurance Act also includes a provision that when a person who must pay back or additional collection due to fraudulent job-seeking benefits claims receives new benefits, the employment center will withhold 10% of the benefits and pay the rest.

Ten percent of the payable job-seeking benefits will be allocated to repayment or additional collection, and with the recipient's consent, more than 10% can be allocated for this purpose.

Reference photo

Furthermore, to systematically promote the Work-Learning Dual System, the government enacted the Act on Support for Industry-Academy Work-Learning Dual System last August. After a year of preparation, the enforcement decree necessary for the implementation of the law was established, with the main contents as follows.

First, the government must establish a "Work-Learning Dual System Promotion Plan" every three years. When formulating the plan, opinions from labor organizations, employer organizations, and others must be collected, and surveys related to the Work-Learning Dual System must be reflected.

Additionally, the government must develop and announce the occupations eligible for the Work-Learning Dual System and the training standards for each occupation. Employers of learning companies can conduct training according to the announced occupations and training standards.

Learning companies and joint training centers participating in the Work-Learning Dual System can receive government support under the Employment Insurance Act. Learning companies receive training costs, lodging and meal expenses, and training incentives, while joint training centers receive operating expenses and facility equipment costs.

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