Repeated Claimants of Unemployment Benefits to Face Up to 50% Cut... Eoljung Workers and Reemployment Job Seekers to See 'Eased' Rules

Establishment of Repeated Benefit Restriction Device... Employment Insurance Act Amendment Approved at Cabinet Meeting

A citizen visiting the Seoul Yeongdeungpo-gu Southern Employment Center is seen heading to the unemployment benefits application consultation desk. Photo by Jinhyung Kang aymsdream@

[Sejong=Asia Economy Reporter Moon Chaeseok] The government has decided to gradually reduce the unemployment benefits received by individuals who repeatedly claim benefits above a certain level, cutting the amount by up to half. This law was established to firmly prevent moral hazard. However, the regulations will be relaxed for daily workers and job seekers who urgently need unemployment benefits.

On the 2nd, the Ministry of Employment and Labor announced that the amendment to the Employment Insurance Act and related laws was reviewed and approved at the Cabinet meeting. A task force (TF) for improving the employment insurance system, consisting of labor, management, and experts, held discussions from April to June. After the Employment Insurance Committee's resolution on July 9, the amendment was drafted, announced for legislation on July 23, and approved at the Cabinet meeting on the same day.

The core of the amendment is that for individuals who have received unemployment benefits three or more times within five years, the benefit amount will be reduced by up to 50% starting from the third claim. Specifically, a 10% reduction applies for three claims within five years, 25% for four claims, 40% for five claims, and 50% for six or more claims. The waiting period from qualification to actual receipt of benefits will also be extended from 7 days to up to 4 weeks. For up to three claims, the waiting period is 2 weeks, and for four or more claims, it is extended to 4 weeks.

The regulations will be somewhat relaxed for those deemed to be in urgent need of unemployment benefits. Exceptions will be made for daily workers with frequent job changes and proactive job seekers who find reemployment within less than half of the benefit period and work for more than 12 months. When these individuals receive unemployment benefits, the cases will be excluded from the count of benefit claims.

Conversely, employers at workplaces with an excessively high number of benefit recipients will face increased insurance premiums. Employers whose unemployment benefit claims exceed five times the unemployment insurance premiums paid over three years, or who operate workplaces where over 90% of employees who left had less than 12 months of service, will be required to pay up to an additional 40% in unemployment insurance premiums.

The amendment also includes improvements to the employment insurance system, such as setting the minimum age for employment insurance coverage for artists and others at 15 years old and allowing voluntary enrollment if desired.

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