Hankyungyeon "Regret over Special Employment Insurance Mandatory Enrollment Passing Cabinet Meeting"

"Job Losses Possible Due to Increased Employer Burden... Alternatives Must Be Developed Together"

[Image source=Yonhap News]

[Asia Economy Reporter Ki-min Lee] The Korea Economic Research Institute (KERI) expressed regret over the passage of a bill mandating employment insurance coverage for workers in special employment types (SETs) at the Cabinet meeting, stating that it could rather exacerbate the difficulties faced by SET workers.

The Federation of Korean Industries-affiliated KERI issued a statement on the 8th saying, "Despite concerns from the business community, we regret that the government bill mandating employment insurance coverage for SET workers was approved as originally proposed at today's Cabinet meeting."

At the Cabinet meeting, the government reviewed and approved amendments to the Employment Insurance Act and the Act on the Collection of Employment and Industrial Accident Insurance Premiums, both under the Ministry of Employment and Labor. The amendments require SET workers to be automatically enrolled in employment insurance and provide unemployment benefits if they have paid premiums for at least 12 months out of the 24 months prior to unemployment.

KERI commented, "During the government's public notice period in July, the business community opposed the mandatory employment insurance coverage for SET workers, citing concerns that it would widen the employment insurance fund deficit and increase costs and management difficulties for employers. Especially amid the prolonged COVID-19 crisis, if the bill is proposed and passed by the National Assembly, the increased burden on employers could lead to job losses, thereby worsening the difficulties faced by SET workers."

They added, "We hope that when the government bill is discussed in the National Assembly, alternatives will be sought to minimize side effects, such as separating accounts for wage workers and unemployment benefits, applying voluntary enrollment methods, and rationalizing the insurance premium burden ratio for SET workers."

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