Approval of Employment Insurance for Special Types of Workers Including Insurance Planners from July at the Cabinet Meeting

Part of Nationwide Employment Insurance Policy
Four Laws Including Employment Insurance Act Deliberated and Resolved at Cabinet Meeting
Employers and Employees Each Bear 0.7% Insurance Premium
Quick Service and Substitute Driving Covered from January Next Year
Exclusion Reasons for Special Employment Injury Insurance Limited to Illness and Parental Leave
Amendment to Ease Employer Burden Approved Accordingly

Former Minister of Employment and Labor Lee Jae-gap giving a briefing on the nationwide employment insurance initiative at the Government Seoul Office in Jongno-gu, Seoul on December 23 last year. Photo by Kang Jin-hyung aymsdream@

[Sejong=Asia Economy Reporter Moon Chaeseok] The government reviewed and approved a bill at the Cabinet meeting on the 1st to apply employment insurance to special employment workers (SEWs) such as insurance planners starting next month. Upon implementation of the system, SEWs will share a 0.7% insurance premium with their employers. Additionally, a regulation restricting store owners from arbitrarily presenting contracts exempting delivery drivers (riders) from industrial accident insurance was also approved on the same day.

The Ministry of Employment and Labor announced that four related laws, including the Enforcement Decree of the Employment Insurance Act, were approved at the Cabinet meeting. The policy to include SEWs in employment insurance is part of the government's 'Universal Employment Insurance' roadmap. Artists have already been included as beneficiaries of employment insurance, and the government plans to gradually expand the scope to include SEWs, self-employed workers, and others.

From the 1st of next month, employment insurance will be applied to 12 occupations including insurance planners, home tutors for study materials, educational tool visiting instructors, parcel delivery workers, loan solicitors, credit card membership recruiters, door-to-door salespersons, rental product visiting inspectors, home appliance delivery workers, after-school instructors, construction machinery workers, and freight truck owners. Quick service and designated driver workers will be included as insured persons starting January next year after revising the enforcement decree related to platform business owners' employment insurance obligations in the second half of this year. The government aims to apply employment insurance to other SEW occupations after July next year. However, SEWs whose monthly remuneration under labor provision contracts is less than 800,000 KRW are excluded from employment insurance coverage. From January next year, SEWs who have signed two or more labor provision contracts can apply for combined monthly remuneration, and if the total amount is 800,000 KRW or more, they can enroll in employment insurance.

The insurance premium rate is 1.4%, with SEWs and employers each bearing half. This rate is 0.2 percentage points lower than the 1.6% for regular workers, and the actual premium burden on SEWs is 0.9 percentage points lower than that of regular workers. The income used to calculate the premium is the amount after excluding non-taxable income and expenses from business income and other income under the Income Tax Act. The premium cap is set within ten times the average subscriber premium.

SEWs enrolled in employment insurance will be eligible for unemployment benefits upon job loss. Those who have paid premiums for at least 12 months out of the 24 months prior to the date of job separation are eligible for unemployment benefits. The daily maximum unemployment benefit is 66,000 KRW, the same as for regular workers. Unemployment benefits can also be received if job separation is due to income reduction. In such cases, certain conditions must be met, such as a 30% or more decrease in remuneration over the three months prior to the month of separation compared to the same period last year. Maternity benefits will be provided at 100% of the average monthly remuneration for 90 days to those who meet requirements such as having been insured for at least three months before childbirth and having an average monthly remuneration for one year prior to childbirth.

Policies to ease the burden on employers following the enforcement of the revised decree from the 1st of next month, which prohibits employers from coercing SEWs to opt out of industrial accident insurance, were also approved on the same day. Insurance premiums will be temporarily reduced by up to 50% for high-risk, low-income SEW occupations. The Ministry of Employment and Labor will select target occupations based on accident rates exceeding 50% of the average across all industries, considering premium burden and workforce size, and will announce the reduction levels and duration.

Additionally, amendments related to expanding the scope of industrial accident insurance for SEWs, including allowing unpaid family workers to enroll in industrial accident insurance and improving the recognition criteria for noise-induced hearing loss as an occupational disease, were also approved this month.

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