Ministry of Employment to Provide Employment Retention Subsidies for 3 Consecutive Years to Large Corporations... Aviation Industry Gets a Breather

[Image source=Yonhap News]

[Asia Economy Sejong=Reporter Lee Jun-hyung] The Ministry of Employment and Labor will provide employment retention subsidies for three consecutive years only to companies experiencing deteriorating business conditions.

On the 22nd, Minister of Employment and Labor An Kyung-duk stated, "We will continue to support employment retention subsidies in the third year for companies still facing difficult business conditions due to the spread of Omicron, regardless of company size."

According to the Enforcement Decree of the Employment Insurance Act, repeated support for employment retention measures conducted in the same month for more than three years is generally restricted. However, if the head of the competent employment security agency recognizes that support is unavoidable, exceptions allowing three consecutive years of support are possible. Previously, in December last year, the Ministry of Employment and Labor instructed local offices that, in principle, the necessity of support must be recognized for small and medium-sized enterprises.

Following this decision by the Ministry of Employment and Labor, large corporations that posted losses last year can receive employment retention subsidies by having the necessity of employment retention measures recognized. Even if a company recorded a profit last year, if the net income was negative, it qualifies for three consecutive years of employment retention subsidies. Large corporations that posted profits last year as well as in 2020 will not have the necessity of support recognized.

Low-cost carriers (LCCs) are expected to have some relief. LCCs such as Jeju Air, Jin Air, and Busan Air were designated as special employment support industries due to the spread of COVID-19 and have been receiving employment retention subsidies since March 2020. The LCC industry has been closely watching whether the Ministry of Employment and Labor will extend the employment retention subsidy support, as they have not been able to improve poor performance caused by decreased passenger demand.

Despite the regulation limiting support for three consecutive years, the Ministry of Employment and Labor expects that most large corporations will receive employment retention subsidies this year. Large corporations wishing to receive employment retention subsidies should submit a "Request for Review of Continuous Support for More Than Three Years," containing materials on business conditions, along with the employment retention plan report to the competent employment center.

Minister An said, "The government will actively support efforts by labor and management to maintain employment even under difficult conditions."

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