"Special Employment Insurance Government Plan, Gap with Reality... Opinions of Stakeholders and Industry Must Be Collected"

KCCI Surveys 151 Special Employment Companies on 'Industry Opinions on Introducing Employment Insurance for Special Employment Types'
88% of Industry Favor Changing Enrollment Methods to Opt-out or Voluntary Enrollment
Concerns Raised Over Low-Performance Job Issues and Potential Labor-Management Conflicts

[Asia Economy Reporter Ki-min Lee] As the government pushes for employment insurance for workers in special types of employment (Specially Employed Workers, SEWs), the industry has expressed the view that the system should reflect the fact that their work characteristics differ from those of regular employees.

According to a survey conducted by the Korea Chamber of Commerce and Industry (KCCI) on 151 companies related to SEWs regarding the "Industry Opinions on the Introduction of Employment Insurance for SEWs," the related industry stated on the 12th that the system should be designed considering the nature of SEW workers. SEWs refer to occupational groups such as insurance planners, caddies, private tutors, and delivery drivers who work under contracts with business owners like self-employed individuals.

In September, as part of the nationwide employment insurance initiative, the government submitted a bill to amend related laws to apply employment insurance to SEWs. The amendment includes ▲ mandatory enrollment of SEWs in employment insurance ▲ joint payment of employment insurance premiums by business owners and SEWs ▲ management of SEW employment insurance enrollment by business owners.

Among the responding companies, 24.7% supported the government’s plan, which treats SEWs the same as regular employees, and 48.0% suggested supplementing the government plan before implementation, totaling 72.7% who did not oppose the introduction of employment insurance for SEWs.

However, the industry responded that considering the characteristics of SEWs, enrollment in employment insurance should be on an opt-out basis (exemption upon application, 64.2%) or voluntary enrollment (23.8%).

Regarding the proposal for business owners and SEWs to share employment insurance premiums equally, opposition was stronger. Currently, regular employees and companies each pay 0.8% of wages (1.6% total), while self-employed individuals pay 2% entirely by themselves.

More than half of the industry pointed out that the employment insurance premium should be paid less by the business owner than the SEW (31.8%) or fully by the SEW (26.5%). Only 41.7% agreed with the employee-type system where business owners and SEWs share the premium equally. Additionally, many expressed that if business owners manage SEW employment insurance, the management burden would increase, so SEWs should manage their own enrollment and withdrawal based on their income.

"If the government plan is processed, there is a high possibility of job losses and labor-management conflicts"

There were also many forecasts that jobs would decrease, especially among low-performing SEWs. In response to the question about the possibility of contract termination for low-performing SEWs, 74.2% answered "there is a possibility." Until now, contracts have been maintained even for somewhat low-performing SEWs, but with mandatory employment insurance, companies will have to decide whether to enter into or renew contracts considering the additional costs and burdens.

Furthermore, the industry expressed concerns that the introduction of employment insurance for SEWs could directly lead to labor-management issues (72.8%). In fact, labor groups are demanding recognition of SEWs’ labor rights (the right to organize, collective bargaining, and collective action).

Jeon In-sik, head of the Employment and Labor Policy Team at KCCI, said, "Since SEWs differ in nature from regular employees, major countries do not mandate automatic enrollment in employment insurance. While a necessary social safety net should be thorough, creating a system disconnected from reality could negatively impact the industry and jobs. We ask that during future parliamentary discussions, the opinions of SEWs and the industry be fully considered to design a reasonable system that can be smoothly implemented."

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