Flood of Insurance Labor Issues... Mandatory Employment Insurance for Agents and Legalization of Labor Unions

Government Submits Bill to Mandate Employment Insurance Enrollment for Special Employment Workers
National Insurance Agents Union Files Union Establishment Report with Ministry of Employment

The insurance planner exam is being held on the 26th at the Myeongji College sports field in Seodaemun-gu, Seoul, to prevent the spread of the novel coronavirus infection (COVID-19). Photo by Moon Ho-nam munonam@

[Asia Economy Reporter Oh Hyung-gil] The insurance industry is struggling with labor issues that have recently become a hot topic. In the current regular session of the National Assembly, following the push for 'universal employment insurance' including special employment types such as insurance planners in response to the COVID-19 pandemic, demands have emerged to guarantee the three labor rights (the right to organize, collective bargaining, and collective action) for planners.

According to the insurance industry on the 5th, the likelihood is increasing that a bill allowing 'special employment workers' such as insurance planners, golf course caddies, and substitute drivers to receive employment insurance benefits when they lose their jobs will be passed during this regular session of the National Assembly.

On the 11th of last month, the government submitted amendments to the 'Employment Insurance Act' and the 'Act on the Collection of Employment Insurance and Industrial Accident Compensation Insurance Premiums,' which mandate employment insurance enrollment for special employment types, to the National Assembly.

Despite concerns that individuals may hesitate to enroll in employment insurance due to exposure of their income or premium burdens, or that employers might reduce jobs, the ruling Democratic Party of Korea is firmly committed to passing the special employment insurance law within this regular session.

Within the insurance industry, there are growing concerns about the mandatory employment insurance. Even among the planners, who are the subjects of the insurance, opinions are divided, and there are calls for discussions on various alternatives such as optional enrollment or adjusting the premium burden ratio.

The issue is that this mandatory employment insurance will mark a turning point in the insurance industry’s recognition of planners as workers for the first time. This is expected to intensify pressure regarding the 'three labor rights,' which have not been traditionally accepted in the insurance sector.

Planners have been predominantly viewed as independent contractors rather than employees because they have freedom in commuting and operate independently. Accordingly, while they are classified as special employment workers and covered by industrial accident compensation insurance under the Industrial Accident Compensation Insurance Act, they have not been recognized as workers under the Labor Standards Act or the Trade Union and Labor Relations Adjustment Act.

In particular, planners have been denied registration of special employment worker unions because they are 'non-exclusive' workers receiving assignments from multiple insurance companies.

The National Insurance Planners Labor Union, affiliated with the Korean Confederation of Trade Unions, submitted a union registration application to the Ministry of Employment and Labor in September last year but has not received a union establishment certificate for over a year.

However, with the recent increase in legalization cases of special employment worker unions such as substitute drivers and after-school instructors, there is speculation that demands for the legalization of planners’ unions may be accepted. The insurance industry fears that mandatory employment insurance or union legalization will inevitably lead to negative impacts such as restructuring.

An industry insider said, "While we can somewhat understand the mandatory employment insurance for planners as an expansion of the social safety net, recognizing the three labor rights for planners who operate as independent contractors is excessive."

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