Employment 2009

www.molab.go.
kr/english
Employment Insurance
White Paper 2009
Introduction to the Employment Insurance Plan
of the Republic of Korea
Ministry of Labor
Republic of Korea
Opening Message
The Employment Insurance Plan of Korea has been enforced since 1995.
Unlike other countries that provide the jobless with passive unemployment
benefits, the Employment Insurance Plan of Korea not only supports job skills
development of workers, provides various subsidies and allowances for
employment retention and supplies information on employment, but also plays
a critical role as a key to implement active labor market policy.
The plan is one of the most important tools of labor policies. It prevents
unemployment, encourages the vulnerable and the jobless to stay in the labor
market and supports human resources development of companies. Korea
could recover from massive unemployment following the financial crisis of 1997
very soon thanks to the plan, and the country is weathering the global recession
of recent with the plan.
So far, we have been asked by officials and experts from other countries to
offer information on the labor policy of Korea, especially, on the Employment
Insurance Plan. To answer the requests, some part of the Employment
Insurance White Paper 2009, which is originally written in Korean, is now being
published in English.
Employment Insurance White Paper 2009
Electronic version of the paper can be downloaded at the homepage of the

Ministry of Labor of Korea(www.molab.go.kr/english). For further inquiries,
please refer to the contact numbers listed on the last page of this paper.
I expect this book can greatly enhance the international community's

understanding of the Employment Insurance Plan of Korea.
November 2009
Lee, Chae-pil
Deputy Minister for Planning and Cooperation Office

Ministry of Labor
Contents
PART
INTRODUCTION TO THE EMPLOYMENT INSURANCE
PLAN OF THE REPUBLIC OF KOREA
SECTION I. THE PURPOSE AND FUNCTION OF THE
EMPLOYMENT INSURANCE PLAN ……………………… 12
Chapter 1. THE PURPOSE OF THE EMPLOYMENT
INSURANCE PLAN …………………………………………… 12
SECTIONⅡ. SUMMARY OF THE EMPLOYMENT

INSURANCE PLAN …………………………………………… 15
Chapter 1. EMPLOYMENT INSURANCE ………………………………… 15
Chapter 2. APPLICATION ………………………………………………… 16
1. Work Places ……………………………………………………………… 16
2. Workers Excluded From the Program …………………………………… 17
Chapter 3. ADMINISTRATION …………………………………………… 18
Chapter 4. JOB STABILIZATION PROGRAMS …………………………… 20
Chapter 5. JOB CAPABILITY DEVELOPMENT PROGRAM …………… 24
Chapter 6. UNEMPLOYMENT BENEFIT ………………………………… 27
Chapter 7. COLLECTION OF INSURANCE PREMIUM ………………… 29
Chapter 8. REVIEW PROCEDURE ………………………………………… 31
PART
EMPLOYMENT INSURANCE PLAN
SECTION I. JOB STABILIZATION PLAN ………………………………… 34
Chapter 1. OVERVIEW ……………………………………………………… 34
1. Purpose and Background ………………………………………………… 34
2. History …………………………………………………………………… 36
3. Results …………………………………………………………………… 37
Chapter 2. JOB CREATION ASSISTANCE ………………………………… 40
1. History and Purpose ……………………………………………………… 40
2. Programs ………………………………………………………………… 40
3. Result and Evaluation …………………………………………………… 41
Chapter 3. SUBSIDY TO ASSIST JOB ADJUSTMENT ………………… 43
1. Overview of the Plan …………………………………………………… 43
2. Subsidy for Keeping Jobs ……………………………………………… 46
3. Subsidy to Encourage Job Change ……………………………………… 62
4. Subsidy to Encourage Re-Employement ………………………………… 66
Chapter 4. SUBSIDY TO ENCOURAGE EMPLOYMENT ……………… 67
1. Purpose …………………………………………………………………… 67
2. Contents of the Plan ……………………………………………………… 69
3. Subsidy to Encourage Employment of the Aged………………………… 69
4. Allowance to Supplement the Peak Wage Plan ………………………… 75
5. Subsidy to Promote Childcare Leave …………………………………… 77
6. Subsidy to Encourage Employment of the People Completing
the Training for Middle and Upper Middle Aged Workers ……………… 80
7. Subsidy to Encourage New Employment ……………………………… 81
Contents
Chapter 5. AID TO CONSTRUCTION WORKERS ……………………… 85

1. Purpose of the Aid ……………………………………………………… 85
2. Details of the Program and Payments …………………………………… 85
Chapter 6. AID TO CHILDCARE FACILITIES IN WORK PLACES …… 86

1. Purpose of the Program ………………………………………………… 86
2. Childcare Facilities in the Work Places ………………………………… 87
3. Contents of the Program ………………………………………………… 87
4. Result and Evaluation …………………………………………………… 89
Chapter 7. IMPROVEMENTS MADE TO THE JOB SECURITY

PLANS IN 2008 ………………………………………………… 90
1. Restructuring the Job Security Plan ……………………………………… 90
2. Improving the Subsidy to Encourage New Employment Plan ………… 90
3. Increasing Amount of Subsidy to Encourage Job
Change Training. ………………………………………………………… 91
4. Increasing Amount of Subsidy to Encourage SMEs to Improve
Working Environment. …………………………………………………… 91
5. Increasing Amount of Subsidy to Encourage Re-Employing Female
Workers After Their Pregnancy & Giving Childbirth …………………… 92
6. Other Improvements to the Plan ………………………………………… 94
SECTIONⅡ. JOB CAPABILITY DEVELOPMENT PROGRAMS ………… 95
Chapter 1. OVERVIEW ……………………………………………………… 95

1. Background and Purposes ……………………………………………… 95
2. Laws and Regulations Related to JCDP ………………………………… 97
Chapter 2. AID TO THE JCDP BY THE BUSINESS OWNERS ………… 98

) …………… 98
1. Aid to the Job Capability Development Training “JCDT”
(
2. Loan for Training Facilities and Equipments ………………………… 103
3. Assistance to In-House Qualification Program ………………………… 104
Chapter 3. AID TO SMALL AND MEDIUM SIZE ENTERPRISES ……… 105

1. Small and Medium Size Enterprise “SME”
( ) Job Training
Consortium Program …………………………………………………… 105
2. Assisting Study Groups in SMEs ……………………………………… 106
3. Assisting SMEs Trainings to Improve Core Job Capabilities ………… 107
Chapter 4. ASSISTANCE TO THE EMPLOYED WORKERS …………… 108

1. Allowance for Education Fee ………………………………………… 108
2. Student Loan for Workers ……………………………………………… 109
3. Loan for Training Fee ………………………………………………… 111
4. Subsidy for Qualification Test Fee …………………………………… 111
Chapter 5. AID TO THE TRAINING OF THE UNEMPLOYED ………… 112
1. Training of Unemployed People who are Changing Jobs ……………… 112
2. Training for Priority Occupational Areas ……………………………… 114
Chapter 6. PERFORMANCE RECORD OF THE JCDP ………………… 115
1. Overview ……………………………………………………………… 115
2. Assistance to JCDP …………………………………………………… 116
3. Assistance for the Training for the Unemployed
People to Change Jobs ………………………………………………… 119
Chapter 7. IMPROVEMENTS MADE TO THE JOB SECURITY
PLANS IN 2008 ………………………………………………… 120
SECTIONⅢ. UNEMPLOYMENT BENEFIT ……………………………… 122

Chapter 1. OVERVIEW …………………………………………………… 122
1. What is Unemployment Benefit ……………………………………… 122
2. Basic System of UB …………………………………………………… 122
3. Programs in UB Plan …………………………………………………… 123
Chapter 2. JOB SEEKING BENEFIT “JSB”
( ) …………………………… 125
1. Overview ……………………………………………………………… 125
2. Requirements to Receive JSB ………………………………………… 126
3. Prescribed Payment Days ……………………………………………… 128
Contents
4. Payment Amount ……………………………………………………… 130

5. Payment Procedure (Acknowledging Unemployment)………………… 132
6. Record of the Payment ………………………………………………… 132
Chapter 3. SICKNESS BENEFIT ………………………………………… 132

1. Overview ……………………………………………………………… 132
2. Payment Period ………………………………………………………… 133
3. Limitation to the Payment ……………………………………………… 133
4. Record of Payment……………………………………………………… 133
) ……………………………… 134
Chapter 4. EXTENDED PAYMENT “EP”
(
) ……………………………… 134
1. Payment Extended for Training “PET”
(
) ………………………………… 136
2. Individual Extended Benefit “IEB”
(
) … 137
Chapter 5. ALLOWANCE TO PROMOTE EMPLOYMENT “APE”
(
) …………………………… 137
1. Early Re-Employment Allowance “ERA”
(
) …………………… 138
2. Job Capability Development Allowance “JCDA”
(
) ……………… 139
3. Allowance for Seeking Job in Remote Place “ASJRP”
(
) …………………………………………… 140
4. Moving Allowance “MA”
(
Chapter 6. RESTRICTION ON PAYMENT AND ORDER TO REPAY

THE BENEFIT UPON FINDING OF RECEIPT BY
WRONGFUL MEANS ………………………………………… 141
1. Overview ……………………………………………………………… 141
2. Examples of Wrongful Conducts ……………………………………… 142
3. Discontinuance of Payment …………………………………………… 142
4. Judging False Reporting ……………………………………………… 142
5. Repayment Order and Decision to Collect Penalties…………………… 142
Chapter 7. UNEMPLOYMENT BENEFIT(“UB”) PAYMENT

RECORD IN 2008 ……………………………………………… 144
1. UB Payment Record …………………………………………………… 144
SECTIONⅣ. PROTECTION OF MATERNITY AND SUPPORTING

WORK AND LIFE BALANCE ……………………………… 150
Chapter 1. OVERVIEW …………………………………………………… 150
1. Purposes and Goals …………………………………………………… 150
2. Areas of Female Workers’ Maternity Protection ……………………… 150
Chapter 2. CONTENTS OF THE MATERNITY PROTECTION
BENEFITS ……………………………………………………… 152
1. Childbirth Leave Benefit (Including Miscarriage and Stillbirth
Leave Benefit) ………………………………………………………… 152
2. Childcare Leave Benefit “Childcare
( Benefit”)………………………… 153
3. Result and Evaluation of the Maternity Protection Benefit …………… 154
Chapter 3. DISCONTINUANCE AND RETURN OF BENEFIT
PAYMENT ……………………………………………………… 155
1. Discontinuance of Benefit Payment …………………………………… 155
2. Return of Benefit for Wrongful Conduct of the Insured Person ……… 155
3. Record of Discovered Wrongful Receipts ……………………………… 155
SECTIONⅤ. ADJUDICATION ON EMPLOYMENT INSURANCE …… 157

1. Purpose ………………………………………………………………… 157
2. Application and Decision Making of AEI ……………………………… 157
3. Review ………………………………………………………………… 161
4. Record of the Application for AEI and the Request for a Review …… 163
5. Consolidating Referees of AEI ………………………………………… 167
Appendix
1. Statistics on Employment Insurance Plan of Korea ………… 170
2. Projects & project managers of Employment
Insurance Plan………………………………………………………… 173
www.molab.go.kr/english

Introduction to the Employment Insurance Plan of the Republic of Korea
PART_01
Introduction to the Employment Insurance

Plan of the Republic of Korea
Section The Purpose and Function of the

Employment Insurance plan
Section Summary of the Employment

Insurance Plan
SECTION
THE PURPOSE AND FUNCTION OF THE
EMPLOYMENT INSURANCE PLAN
Chapter 1
THE PURPOSE OF THE EMPLOYMENT
INSURANCE PLAN
Employment Insurance “EI”

( ) is one of the social security plans being practiced in the
Republic of Korea “Korea”
( ). It is comprised of:
Traditional Unemployment Insurance “UI”

( ) which pays workers who lost their
jobs the unemployment benefit;
Job Security Programs “

( JSP”) devised to promote re-employment and job
security of the workers by connecting the jobs and the people looking for
employment;
Job Capability Development Program “JCDP”

( ) for better work performance of
employees.
EI goes one step further than UI. UI simply supports livelihood of the workers who
have lost their jobs. It’s a passive medium as it helps people only after they have lost
their jobs. EI is positive and preemptive comparing to UI. EI is one of the measures in
Korea for a comprehensive labor market policy that has programs to:
assist the workers who lost their jobs with their livelihood;
assist the workers who lost their jobs to find new jobs;
prevent workers from losing jobs;
advance security of jobs;
restructure the labor market;
improve the workers’ job performance capabilities.
Employment Insurance White Paper 2009 ■ 12

[Diagram 1] Basic structure of the employment insurance plan
Programs to Improve Job Security : Prevention of Unemployment,
Improvement on Re-employment of Jobless Workers, Employment
Promotion of the Vulnerable
Employment
PART 1 _ Introduction to the Employment Insurance

Insurance Programs to Develop Workers’Job Performance Capabilities : Lifetime
Plan Support to Improve Workers Job Performance Capability

Unemployment Benefit : Assist workers who lost their jobs with their
livelihood and with finding new job
Workers in the capitalist society provide their labor to the employer and sustain
themselves with the remuneration they receive in return. When a worker loses his/her
job, it causes loss of livelihood for the worker and his/her family. Loss of job for a
worker has the same impact on his or her living as those of an injury, sickness,
ageing, and death.
PART 2 _ Employment Insurance Plan

Unemployment means not only loss of national human resources. Unemployment also
causes deterioration of the quality of worker’s job performance capability as he or she
loses the opportunity to maintain and improve skills and knowledge.
From the perspective of the national economy, the increase of unemployment cut
consumer demand as the purchasing power of the worker and his/her family members
reduces, and this in turn decrease production and employment and expands the
unemployment so as to disrupt the national economy. For such reasons, securing job
stability and achieving full employment are important goals of national economic
Appendix
policy of every country in the world.
On the other hand, unemployment in the capitalist economy is inevitable because

businesses continuously rise and fall even during a boom period. Unemployment is
also becoming a social risk that may happen to everybody as a result of restructuring
of industry caused by innovation and/or economic fluctuation. Upon such
understanding, the government, the employers, and the employees work together to
13 ■ Ministry of Labor Republic of Korea

stabilize the livelihoods of workers by adopting national unemployment insurance or
employment insurance plan.
Provision of unemployment benefit under the unemployment insurance alone is not

sufficient to ensure living standard of workers who lost their jobs. Therefore,
employment insurance plan of Korea encompasses job security programs that
promote employment and job adjustment and programs to develop workers’ job
performance capabilities.

SECTION
SUMMARY OF THE EMPLOYMENT
INSURANCE PLAN

Chapter 1 EMPLOYMENT INSURANCE
Employment Insurance “ ( EI”) comprises of Job Security Program “( JSP”), Job

Capability Development Program “JCDP”
( ), and Unemployment Insurance “UI”
( ).
JSP includes Job Creation Program “ ( JCP”), Job Adjustment Support Program
“JASP”
( ), and Program for Promotion of Employment of the Disadvantaged “PPED”
( ).

JCP intends to create jobs by reduction of working hours and/or by transforming shift
work plans.
PPED is for the aged and women who are at disadvantage in the labor market.
JCDP provides various benefits to the employers who carry out trainings and
educations for their employees to improve their work performance capability. Its goal
is to give the employers the incentive to provide training and education to their
employees at work. It is expected that JCDP will increase labor productivity, workers’
wage level, and the competitiveness of businesses. It is also expected that JCDP will
make the work place not only a place to work but also a place to learn to improve
Appendix
their work performance capability.
Unemployment Benefit “UB”( ) is aimed at stabilizing the livelihood of the workers

who lost their jobs and at assisting them to find a job by providing them with UB for
a certain period. UB of Korea pays basic wage to the unemployed for a certain period.
Moreover, It also has the programs to motivate the unemployed;
to attend job training programs,
to search for employment opportunities.

The programs comprises of:
Provision of basic wage while the unemployed attend job training courses;
Payment of Early Re-employment Benefit “ERB”
( ) to the worker who finds job
in a short time;
Payment of Child Care Leave Benefit “CCLB”
( ) and Child Birth Leave Benefit
“CBLB”
( ) designed to provide job security for female workers.
Chapter 2 APPLICATION
1. Work Places
EI applies to all work places in principle. However, work places or businesses of a certain
size are exempted by Regulations. However they also can join the program if more than
half of the employees working for concerned business agree to join the program.
When the Employment Insurance Act “EIA”

( ) was first promulgated, the UB applied
to businesses or work places with 30 or more permanent employees, and JSP and
JCDP applied to those with 70 or more permanent employees.
The programs were revised a few times to cover more businesses and work places.
From 1 January 1998 the UI was extended to cover businesses and work places with
10 or more permanent employees, reducing the number of employees to be covered
by the Act from 30, and JSP and JCDP to 50 from 70. The UI had extended again to
businesses and work places with 5 or more permanent employees from 10 or more
permanent employees.
JSP and JCDP were extended to businesses and work places with 5 or more from 50
or more permanent employees from 1 July in the same year, then again to all work
places with 1 or more employee from 1 October in the same year.
Further, the EI had been extended to incorporated businesses in the agriculture,
forestry, fishery, and hunting sectors with 5 or less employees, and to construction

works of any size from previous coverage which included only those works with total
construction costs of 340 million won or more(however, construction works
undertaken by an individual with total construction costs of 20 million won or less are
not included). From 1 January 2006 some self-employed people employing 5 people

or less(including those who is not employing anyone), selected on the basis of
his/her income and other considerations, may take advantage of the Act in regard to

the JSP and JCDP with himself/herself as the beneficiary. From 18 September 2008
the Act has been extended to construction works for buildings with total floor area of
100㎡ or less, and to renovation works for buildings with total floor area of 200㎡ or
less(The coverage used to be construction or renovation works for buildings with total
floor area of 330㎡ or less).
2. Workers Excluded From the Program
The Act prescribed that workers who work in the businesses and work places that

comes under the law but not suitable for the Act because of the characteristic of
his/her employment shall be excluded from the application of the Act.
A. Excluded workers at ordinary work places

Workers over the age of 65(JSP and JCDP applies) and those who usually work less
than 60 hours per month (15 hours per week) are excluded.
The EI has been extended to daily workers and new employees over the age of 60 (up
to 64), and more workers on hourly rate are subject to the program. From 1 January
2006, JSP and PWDW programs (UI excluded) apply to workers over the age of 65.
Appendix
B. Workers in particular job categories are excluded

Public servants
Public servants employed under the National or Local Public Servants Act are
excluded (but Servants on Special Employment Terms and Public Servants Employed
on Contract Basis may choose to join). Workers covered by the Private School
Teachers’ Pension Act, and Special Postal Workers are excluded from the EI coverage.

C. Workers excluded on the basis of the nature of the work place
Workers working in the projects being undertaken by central or local government for
the purpose of providing jobs temporarily to the unemployed used to be excluded from
the EI coverage, but now they are also covered from 1 January 2004 based on the
amendment of the Employment Insurance Regulations “EIR”
( ) in December 2002.
D. Foreigners
EI does not apply to foreigners in principle. However, it applies to the followings:

People with resident visa (F-2 Visa) or permanent resident visa (F-5 Visa) are covered
because there is no barrier for them to get employed in Korea;
Other foreigners with permits that allow them to get employed in Korea (C4, E-1~E-8,
E-10, F-4, H-2 Visas) may join if they want to;
Non-specialist Employment Visa (E-9 Visa) holders were used to be covered by rights
but are left to voluntary application from 1 January 2006;
People with Deployment Visa (D-7 Visa), Business Investment Visa (D-8 Visa), and
International Trade Management Visa(D-9 Visa) are covered when their home country
applies their Employment Insurance Plan to Koreans upon the principle of reciprocity.
The Immigration Law of Korea does not allow foreigners who do not hold certain permit
or visa to work in Korea. Therefore, EI does not apply to illegal migrant workers.
Chapter 3 ADMINISTRATION
The EI program is administered by the Minister of Labor to provide administrative support as:
close cooperation and coordination with other government agencies are required
because the program is close related to the promotion of industrial restructuring
and improvement of employment structure;

prevention of abuse of the plan such as illicit application for UB or deceptive
reporting by applicants;
efficient guidance and supervision.
The EI is managed by Employment Policy Division “

( EPD”) of the Ministry of

Labor. EDP is composed of the Head, Employment Policy Director, Job Capability

Director, Equal Employment Policy Director, and Employment Service Policy
Director. However, the Industrial Accident Compensation Insurance “
( IACI”)
Division of the Labor Standard Bureau “LSB”
( )1) is in charge of the application and
collection of EI.
Employment Policy Director is responsible to make policy on:
Planning, adjusting, and administration of principal plan for demand and supply of
human resources;
Planning and adjusting of important policies and management and operation of fund

of the EI.
Job Skills Policy Director is responsible for policies regarding job skills development
training and eligibility requirements for the beneficiaries of the programs. Equal
Employment Policy Director is responsible for policies regarding CCLB and MLB.
Employment Service Policy Director is responsible for policies regarding Job
security, UI, and management of Employment Support Centers of local governments.
Korea Employment Information Center “

( KEIC”) is established to take care of
following works that are essential to the management of the EI:
Collection, analysis, and dissemination of information on the labor market;

Managing Insurance Beneficiaries and Insurance Programs;
Appendix
Payment of benefits and allowances including UB;

Job placement and information on job seekers and job offers;
Collection, analysis, and dissemination of information on JCDP.
1) The Department of Labor was re-structured on 1 May 2009. The job of application and premium collection of EI
was transferred from Occupational Safety and Health Bureau (Industrial Accident Compensation Insurance
Division) to Industrial Accident Compensation Insurance Division in the Labor Standard Bureau.

KEIC is connected to Job Security Services via computer network so that they may
provide fast and accurate services regarding the EI to people. KEIC plays a pivotal
role in the operation of the EI programs.
Chapter 4 JOB STABILIZATION PROGRAMS
When the EIA was first promulgated, JSP was divided and managed by two separate
parts. They are JASP and PPED. The purpose of JASP is to prevent unemployment
and to pay subsidies for employment suspension allowance, for re-allocation of
human resources, and for job transfer training.
PPED has the goal of promoting employment of idle human resources such as the
aged and women, and pays Subsidy for Promotion of Regional Employment, for
Promotion of the aged and others, and for Employment Promotion Facilities.
There have been a number of changes since then. JSP is now comprised of JASP,
PPED, and JCP which started in 2004.
JASP intends to prevent job adjustment/employment adjustment by companies and, to
support the worker who lost job as a consequence of the adjustment find another job.
Subsidy for Employment Maintenance, Subsidy for Job Transfer belongs to JASP.
Subsidy for Employment Retention is paid to employers who retain the employees
who were to be dismissed due to adjustment through suspension of business,
provision of leave, reallocation of the employees, provision of training to the
employees. It pays 2/3~3/4 of the wage paid to the workers and the costs of training
within 180 days of an Insurance Year(1 year in case of reallocation of the employees).
Subsidy for job transfer is provided to the employer who has to go through
adjustment for management reasons and supports their employees who leave their
jobs due to employment adjustment, retirement, or expiration of labor contract
promptly find another job. The subsidy pays 2/3~all of the cost spent within 12
months (300 million won per person at maximum).

Subsidy for re-employment is provided to the employer who re-employs the worker
who had left previous job due to business adjustment within 6 months to 2 years from
his/her dismissal. 400,000 won per person(300,000 won to large companies) was paid
for 6 months, however, the subsidy was abolished in 2009.

PPED is to expand job opportunities for the aged, women, and the long term jobless

who have difficulty in finding jobs in the labor market. It also subsidizes part of the
costs spent for establishment and operation of Employment Promotion Facilities.
Subsidy for Employment Promotion of the Aged, Subsidy for Promotion of New
Employment, Subsidy for Employment of the Aged who have completed job
trainings, Subsidy for Childcare Leave belong to the PPED.
Subsidy for Employment Promotion of the Aged aims to support job security and
employment promotion of the aged who are in special difficulties to find a job in the

labor market. It encompasses Subsidy for Extension of Retirement Age, Subsidy for
Employment Promotion of the Aged in Large Numbers, and Subsidy for Continuous
Employment of Retired Employees. Subsidy for Extension of Retirement Age gives
300,000 won per person when the business extends the retirement age by 1 year or
more than 56 and continues, in accordance with the extended retirement age, to hire
its employee who had worked for the business for 18 months or more for 1/2 of the
extended period. Subsidy for Employment Promotion of the Aged in Large Numbers
pays 150,000 won per person per quarter to the business that fills up 4~42% of total
employees of each industry with the aged who had worked for 1 year or more.
Subsidy for Continuous Employment of Retired Employees provides 300,000 won
per person for 6 months(for 12 months in the manufacturing business with 500 or
Appendix
more employees) when a business that had set the retirement age at 57 continues to
employ or reemploys him/her who had worked in the place for 18 months or more
and is over the retirement age within 3 months from retirement. Subsidy for Childcare
Leave is a program to have female worker take a childcare leave. It pays 200,000 won
per person during childcare leave, and 300,000 won per person per month(200,000
won for large companies) if the employer hires a substitute.

Subsidy for Promotion of New Employment is provided to the employer who
employs the vulnerable in the job market, such as the aged, female household head
and the youth, through job placement service institutions that aims to promote job
security. Every month, 150,000~600,000 won is paid per person for 1 year. Subsidy
for Employment of the Middle Age and the Aged is provided to the employer who
employs a person who is over 40 and has completed training of 1 month or more for
the jobless. 600,000 won for first 6 months and 300,000 won for the other 6 months
was provided, however, the subsidy has been abolished since 2009.
Compensation Allowance for Wage Peak System was established in 2006. It is given
to the employees over the age of 54 who had worked for 18 months or more for a
company that introduced the Wage Peak System. More specifically, when the wage of
concerned employee is reduced by 10% or more, the amount up to 1.5 million won
per quarter computed by multiplying 50/100 to the difference between their peak
wages and their wages of the current year is paid.
Subsidy for continuing employment after childbirth provides the employer
who renews labor contracts for 1 year or longer with the worker whose
employment/dispatch period had expired while she was on childbirth (miscarriage,
dead birth) leave or in pregnancy of 34 weeks or more with 400,000~600,000 won
monthly, for 6 months.
Job Creation Supporting Program, which was established in 2004, comprises of

Subsidy to SMEs for Reducing Working Hours, Subsidy for Changing into Shift
Work System, Subsidy to SMEs for Improving Working Environment, Subsidy to
SMEs for Utilizing Professional Human Resources, Subsidy to SMEs for Entering
into a New Business Area.
Subsidy to SMEs for Reducing Working Hours is provided to the prior target
businesses, which have adopted 40 working hours per week program early and
increased the number of employees. A total of 1.8 million Won per person per quarter
until a law setting 40 working hours per week is promulgated as legal standard.
Subsidy for Changing into Shift Work Plan pays the employer who adopted shift
work plan or changed the shift work plan by increasing the shift units (up to 4 shifts)

and employs more workers than before the adoption or change a total of 1.8 million
Won (1.2 million Won for large companies) per quarter per worker for 1 year.
Subsidy to SMEs for Improving the Work Environment is given to SME owners who
invested 10 million Won or more in order to improve the working environment and

employs worker(s). Half of the invested amount(up to 50 million Won) and 120
million won per employee is provided.

Subsidy to SMEs for Utilizing workers with special expertise and/or skills is provided
for 1 year to the owners of SMEs who employ or who hire and utilize professionals,
such as professional technician, upon assistance by another business which is not a
Prior Support Target Business and increase their competitiveness. A total of 1.2
million Won for the first 6 month and 600,000 Won for the second 6 months per
person is paid.
Subsidy to SMEs for Entering into a new business area pays owners of SMEs who

enter into a new business area and create job(s) by employing worker(s) the sum of
1.8 million Won per quarter per person for 1 year (abolished in 2009).
Loan for Costs of Establishment and Subsidy for Childcare Facilities in Work Place
are for the individual or organization who owns a business and establish and operate
child care facilities in the work place. The costs of establishing the facilities, costs of
converting the facilities and costs of tools and equipments, and the wage of the
childcare teachers, head of the facility, and the cooks are paid. Loan for Costs of
Establishment lends up to 500 million Won(at an annual interest rate at 1~2%,
repayment in 5 years with a 5-year grace period). Subsidy for Facilities pays 50~80%
Appendix
of the costs of Converting the use of Facilities and costs of tools and equipments
differently according to the recipient (costs of converting the use of facilities: up to
100 million Won to an individual owner; up to 200 million to an organization, Costs
of tools and equipments up to 50 million Won). A total of 800,000 Won per month is
paid as the Subsidy for the wage of the childcare teachers, head of facility, and the
cooks while the childcare facility is operating.

Moreover, the following programs are being operated; Subsidy for Premium of
Construction Workers Retirement Insurance, Program for Subsidy for Job Security of
Construction Workers, Subsidy for Employment Management Diagnosis; Subsidy for
Employment of Long Term Unemployed, Subsidy for Improvement of Employment
Environment of the Aged et al.
Job Stabilization Program has expanded its size by creating new support programs
and extending the beneficiaries of the supports. However, there has been criticism as
to its effectiveness. Taking into account of the criticism, efforts have been made to
increase its usage by business owners and effectiveness of the programs by: First,
abolishing those support programs that are ineffective and not much used by the
employers, such as Subsidy for Re-employment, Subsidy for Employment of Middle
to Old Age People who have completed job trainings, and Subsidy to SMEs for
Entering into a new business area; and Second, revising Subsidy for Promotion of New
Employment so that the subsidy is paid in case of employing the vulnerable only.
Chapter 5 JOB CAPABILITY DEVELOPMENT PROGRAM
Human Resource Development Programs in Korea met an important turning point

with the adoption of the Employment Insurance. There used to be Compulsory
Occupational Training Program “COTP”
( ) that impose obligation on large companies
to provide Occupational Training or pay allotted charges. Now the EI provides
comprehensive support for all businesses, workers, and some of the unemployed. The
plan supports the businesses that carry out Job capability Development Training
suitable to their needs and conditions, and individual workers who take part in
training programs on their own as well.
When the EI was introduced in 1995 a dual operation system for JCDP had been
operating. JCDP applied to all work places employing 70 or more permanent

employees and businesses with 1,000 or more workers in 6 industrial areas including
manufacturing and construction were also subject to the COTP under the Principal
Act on Job Training. The COTP under the Principal Act on Job Training was
abolished in 1999 after the enactment of the Act to Promote Job Training of the

Workers, and the JCDP began to apply to all businesses.

The current JCDP under the EIA is divided into 3 parts: support for business owners,
support for individual workers, support for some of the unemployed, and the program
to secure infra structure for job capability development.
Support for business owners is a program assisting business owners with the cost of
provision of JCDT for their employees. Support for business owners has traditional
programs such as Subsidy for JCDT and Subsidy for Paid Training Leave, and
programs specialized for SMEs such as SMEs training consortium, SMEs core job

capability improvement, and education on SMEs.
It is necessary to reduce the gap in the participation to job performance capability

development programs between workers in the large size businesses and those in the
SMEs as there is a big difference between them.
Profit-seeking businesses tend to focus their investment in human resources
development on a small number of core employees and regular employees. Such
tendency is growing recently as flexibility in the labor market increases,
marginalizing the vulnerable such as non-regular worker to more difficult situation
(low skill-bad job trap). Appendix
The program to develop workers job performance capability was introduced for direct
support for vulnerable workers who are suffering from lack of chances to develop
their capabilities under the old job capability development program which had the
business owners as the intermediary medium.
The program to develop workers job performance capability comprises of Allowance

for educational programs participation, Allowance and Loan for Tuition, Allowance

for Testing Costs.“Workers Capability Development Card”was introduced in 2006 as
a pilot program then as a main program in 2007 in order to strengthen the support for
increasing number of non-regular workers.
The EI provides re-employment training to the unemployed so as to minimize the

unemployment period by enabling the jobless who is in the process of job transfer to
obtain necessary skills required for such transfer.
There is a need to raise and supply human resources for strategically important
industries that lay the foundation of national competitiveness or the industries that
suffer from lack of supply of human resources because job seekers are reluctant to
work for them. Such industries are designated as‘priority selection vocations’and
the EI program raise and supply human resources for the industries.
The government carried out Job Capability Development Account Program as a pilot
program in Daegu and Gwangju from 22 September 2008 to March 2009. The
program was designed to discard government regulation-oriented job capability
development training programs and to support user-focused autonomous job
capability development. Job Capability Development Account Program is operated in
the following manner: The government provides a trainee with certain amount of
money, then the trainee determines the program he or she would take with the training
allowance, using the information and consultation provided by the government. The
program introduced market principle of competition(among training institutions) and
choice(of the trainee) to the unemployed. The government is going to expand the pilot
program nationwide, and then, after assessment, to the employees of SMEs gradually.
On top of the above, the EI is implementing programs to build infrastructure by

managing National skills qualification system by providing assistance through public
training institutions such as the Korea Industrial Human Resources Corporation,
Korea Polytec College, and Korea Skill Education University as well as by raising
HRD specialist, supporting private training centers, and creating social atmosphere
where personal capability is highly regarded.

Chapter 6 UNEMPLOYMENT BENEFIT
“Unemployed”under the EI refers to people who are not employed despite their will

and ability to work. The UB is paid to assist the unemployed with their livelihood and
make their job search easier. The UB is divided into Job Search Benefit “JSB”
( ) and

Employment Promotion Allowance “EPA”
( ). JSB is basic payment being provided to
those people who satisfy certain requirements for the Benefit to stabilize their
livelihoods.
JSB is in turn divided into:

Early re-employment allowance;
Job Capability
Development Allowance designed to make it easier for the unemployed to take

vocational training required for his/her re-employment;
Job search allowance designed to give incentive to people seeking jobs in wide
area;
Moving allowance being paid to people who move their home to get job training
or to get re-employed.
When the plan was first introduced,

the requirements to receive the UB used to be;
First, he or she must have provided labor in order to receive wage as an insured
employee of concerned business for more than 12 months(unit period for
Appendix
insurance application) among 18 months(standard period) prior to the job

transfer.
Second, he or she did not resign by his or her own volition or was dismissed for
serious misconduct of his/her own,
Third, he or she was not able to get employed despite his/her will and ability to
work,
Fourth and the last, he or she must actively look for a job;

the prescribed days of insurance payment used to be between 30~210 depending on
the period of coverage of the insurance plan and his/her age.
However, the EIA was amended in order to extend the benefit, and as a result, the unit
period of joining the insurance plan have become 180 days and the prescribed days of
insurance payment has been expanded to 90~240 days.
Furthermore, before, when 10 months have passed since the date of leaving the job,
the UB was not paid afterwards, regardless of prescribed time period, however, now
12 months instead of 10 months have to pass. The unit period of joining the insurance
plan used be nullified once the unemployed was entitled to receive the UB, but it is
now being maintained regardless of whether or not the concerned beneficiary had
received the UB or not by the amendment to the EIA on 31 December 2008.
UB is extended by 60 days for those recipients who are particularly having difficulties
in getting a job and in dire living conditions. The UB may be paid up to 2 years in
case the recipient;
needs job capability development training in order to be reemployed considering
his/her age and work experience,
actually receives job training upon the instruction of the head of a job
stabilization institution while the recipient is attending the job training program.
The amount of extended benefit for job training attendants who are taking the training
to revitalize the company increased to 100% from 70% of the normal job search
allowance daily payment amount.
The UB for 1 day (job search allowance daily payment amount) is 50% of the average
wage (base daily wage amount) before job transfer.
Base daily wage is 80,000 Won even if the calculated base daily wage exceeds
80,000,000 Won.(it was reduced to 60,000 from 70,000 when the plan first
promulgated, and then increased to 70,000 won, and again to 80,000 won from 1
January 2006).

An unemployed person must attend a job stabilization institution between 1 and 4
weeks from dismissal and be admitted to have lost job during the period. He/she must
register for job search. If he or she does not follow, without reasonable cause, job
placement, job guide, and/or job training direction, then the UB payment is stopped or

suspended.

Payment of UB to a person who is entitled to the UB stops;
when he/she does not carry out job search intensively,
when he/she refuses to take job training when directed, or
if he/she did or attempts to receive the benefit by false or illegal means.
On top of UB, a plan that provides childcare leave payments and child birth leave
payments has been in place since November 2001. Childcare leave payments is paid
to a person who has joined the EI for more than 6 months and takes a childcare leave

for more than 30 days. A total of 500,000 Won per month is given for the period up to
10.5 months to women and 12 months to men. Child birth (miscarriage and stillbirth
included) leave is paid to a person who has joined the plan for more than 6 months
(calculated from the last day of the leave) and takes the leave. An amount of money
equivalent to wage of 90 days for prior support businesses and wage of 30 days for other
businesses. Ultimately, up to 1.35~4.05 million or at least the minimum wage is paid.
Chapter 7 COLLECTION OF INSURANCE PREMIUM

Appendix
Different countries take different approaches to the issue of who shall bear the cost of
the EI or the UI. The business owner is responsible for the whole cost in the US but in
most other countries such as Germany, France, Japan, the owner and the labor share
the costs fairly.

As for Korea, The employer and the labor share the cost of the insurance. The
insurance premium for the UB is borne by the employer and the labor equally in half
and half. The insurance premium for job stabilization plan and job capability
development program is all borne by the business owner.
“The Act regarding collection of the insurance premium for the Employment
Insurance and Industrial Accident Compensation Insurance”prescribes that the rate of
EI premium is to be determined by the Executive Order, taking into account of the trend
of the income and expenditure of the Insurance and the economic conditions of the
country within the range of 30/1000 of the total wage, and to be divided into the
insurance premium rate for job stabilization and job capability development program and
the insurance premium for the Unemployment Benefit. According to the Regulations for
the Act, it prescribes flat rate for the UB regardless of the size of the business and
differentiated rates for job stabilization and job capability development program.
The history of the change in the insurance rates is:

Insurance premium rates for the UB went up from 0.6% of the total wage at the
time of the promulgation of the Act to 1.0% on 1 January 1999, then reduced to
0.9% on 1 January 2003;
Insurance premium rates for job stabilization program went up from 0.2% of the
total wage to 0.3% on 1 January 1999, then reduced to 0.15% on 1 January 2003;
An insurance premium rate for the job capability development program was
between 0.1~0.7% as of 1 January 1999.
The job stabilization program and the job capability development program merged
into the job stabilization and job capability development program, and its insurance
rate was between 0.25%~0.85% of total wage.
The employer reports and pays the individually estimated amount of the EI premium
for the relevant year as calculated by multiplying estimated total wage to the
insurance rate by March 31st in every insurance year, then calculate and report the
confirmed insurance premium as calculated by multiplying the wage actually paid to the
insurance rate by March 31st in the next insurance year and make an adjustment. The
employer pays all insurance premiums including the employees’ share altogether at once
and later deducts the employee’s his or her wage at the time of payment of the wage.

Chapter 8 REVIEW PROCEDURE
There is a procedure to investigate and re-investigate objections by the EI beneficiary

or by the people entitled to benefit who think their rights have been improperly
denied by illegal and/or unreasonable administrative conduct by the Head of the job

stabilization institution in regard to his or her administration of the following works:
confirmation of the acquisition and loss of the entitlement as a beneficiary under

the current EIA;
decisions regarding the UB, the Childcare Leave Allowance, Child Birth Leave
Allowance.
This manner of dealing with objections is not unique to the EI but generally applied in
other social insurance plans.

A person who has objections regarding the decision of the institution may first submit
the objection to an Employment Insurance Investigator, and, if not satisfied with the
finding of the Investigator, he or she may request reinvestigation by the Investigation
Committee of the Employment Insurance.
This mechanism of handling objections was adopted under the conception that;
it is not effective to seek remedy for the person who appealed through ordinary
court procedure which takes money and time since the concerned person is
usually unemployed;
as the decision being appealed is usually made publicly and has features of
specialized and skilled area;
Appendix
therefore, it is desirable that such objections are resolved by a specialized

institution before going to a trial.


PART_02
Employment Insurance Plan
Section Job Stabilization Plan
Section Job Capability Development Programs
Section Unemployment Benefit
Section Protection of Maternity and Supporting

Work and Life Balance
Section Adjudication on Employment
Insurance
SECTION
JOB STABILIZATION PLAN
Chapter 1 OVERVIEW
1. Purpose and Background

A. Purpose
The job stabilization plan ‘JSP’

( ) is designed to secure job stability of workers and to
assist the businesses with their job adjustments.
The JSP comprises of:

job creation assistance program;
job adjustment assistance program;
promotion of employment of the vulnerable;
employment promotion facilities assistance program.
The purpose of the job creation assistance program is to provide assistance to the
businesses that have created jobs through reduction of working hours and/or transition
into the shift work system.
The purpose of the job adjustment assistance program is to prevent unemployment,

reduce the burden of management for the businesses by supporting job adjustment of
the struggling businesses.
The purpose of the promotion of employment of the vulnerable is to promote the

employment of the vulnerable such as the aged, long time job seekers, the disabled,
and female household head who are particularly in difficult position to find a job
under the ordinary conditions of the labor market.

The purpose of employment promotion facilities assistance program is to reduce the
burden on women to raise children by assisting the establishment and operation of the
work place childcare facilities.

B. Background

Many countries have been operating traditional UI plan which pays the UB to the
workers who lost their jobs. However, it was difficult to provide security of the
livelihood for the jobless with such minimal and belated relief measure alone. As a
consequence, positive labor market policy measures have become to be connected
with the UI and job security plans increasingly combined with the EI plan.
Once a worker gets a job, it is important to enable him to show high productivity, be
satisfied and proud with his job by developing job capability throughout the whole

employment period, and to make his/her job secure during the unavoidable job
adjustment process caused by economic conditions and change of technology.
Job adjustment is unavoidable during industrial landscape restructuring and the
change of technology, because economic conditions change from time to time.
However, if the businesses dismiss their employers whenever they want on the
ground of job adjustment will threaten the security of the workers’ lives.
Assisting the employers with the cost they have spent by adopting such means as
suspension of business and/or provision of training to keep the employees who were
otherwise to be made redundant during the adjustment process makes the adjustment
process easy and untroubled and ensure job security of the employees.
Appendix
The EIA prescribes in section 21 subsection 1“the Minister of Labor shall carry out
Job Security Programs in order to assist the businesses owners, who has to carry out
job adjustment because his or her business is to be downsized, closed, or transformed
as a result of economic fluctuation, the change in the industrial structure, to provide job
capability development training or relocation of human resources, or other job security
of workers,”and illustrates actual means of such job security plan in sections from 20 to 26.

2. History
When the EIA was first promulgated on 1 July 1995, the JSP comprised of Subsidy
for Leave Payments, Subsidy for Human Resources Relocation, Subsidy for Job
Change Training, Subsidy for Promotion of Employment, Subsidy for Promotion of
Employment of the Aged, and Subsidy of Childbirth Leave Payments. However, since
the programs have been merged, simplified and expanded, there now are Subsidy for
Maintaining Employment, Subsidy for Supporting Job Change, Subsidy for
Re-employment, Subsidy for Promotion of Employment of the Aged, Subsidy for
Promotion of New Employment, and Subsidy of Childbirth Leave Payments. These
programs are being operated as shown in Table -1-1 below.
[Table -1-1] The system of JSP

Assistance to Subsidy to SME for reducing working hours (Regulation 13)
JSP Job Creation
(Section 20 Subsidy for changing into shift work plan (Regulation 14)
of the Act)
Subsidy to SME for improving work environment (Regulation 15)
Subsidy to SME for utilizing workers with special skills (Regulation 16)
Subsidy to SME venturing into a new business area (Regulation 17)
Assistance to Subsidy for keeping Business suspension

Job Adjustment jobs (Regulations
(Section 21 of 18-21) Training
the Act)
Leave
Relocation of human resources
Subsidy to assist job change (Regulation 22)
Subsidy to promote re-employment (Regulation 23)

JSP Assistance to Subsidy to promote Employment in large numbers
Promotion of employment of the
Employment of aged Extension of retirement age
the Aged et al (Regulation 25)
Continuing employment of the retired
(Section 23 of

the Act)
Subsidy to promote new employment (Regulation 26)

Subsidy for employing people who completed job training for middle
and the aged (Regulation 27)
Allowance to supplement the loss from joining the wage peak

system (R. 28)
Subsidy for continuous employment after pregnancy and childbirth
Subsidy for childbirth and other leaves and Subsidy for employing
substitute workers (Regulation 30)
* Plans abolished in the year 2009: Subsidy to SME venturing into a new business area, Subsidy for
Re-employment, Subsidy for Employing those who completed job training for middle and the aged

3. Results
The JSP has expended:

267.7 billion Won in year 2005 in construction of the Job Centers’ own buildings and
in activation of the Job Creation Assistance Plan;
608.2 billion Won in year 2006 upon promulgation of new plans, securing the infra
structure for job security such as construction of Job Experience Complex, activation
of the Subsidy for Promotion of New Employment and the Assistance to Job Creation
Program, making 127.2% increase compared to the previous year;
Appendix
845.6 billion Won in year 2007 upon activation of the Subsidy for Job Stabilization,
increasing by 62.5% increase compared to the previous year; and 825.8 billion Won
recording 23.4% reduction compared to the previous year as a consequence of
expanding the requirements for the Subsidy for Promotion of New Employment
application.

[Table -1-2] Table of payments under each program in the JSP
(unit: 100 million won)
Amount of Expenditure
Program
1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008
Total 85.2 122.44 1,098.7 1,975.0 1,257 1,471 1,179 1,127 1,410 2,677 6,082 8,456 8,258
Subsidy for 0.2 0.4 742.2 794.3 293.9 559.7 327 274 320 309 336 325 306
keeping jobs
Subsidy to encourage
— — 58.7 751.8 407.8 202.3 14 0.1 — — — — —
employment
— — — 5.2 14.2 7.6 5 7 3 8 9 9 7
re-employment
Subsidy to encourage — — — — — 0.4 4 6 14 15 15 24 15

job change
Subsidies to trainings
(to start new business∙
— 0.04 3 — — — — — — — — — —
to adapt to his/ her job∙
to get a new job)
Promoting employment
65 90 121.7 254.5 367.5 416.2 400 462 413 340 360 409 481
of old people
— — — 0.5 3.6 29.5 72 52 60 — — — —
of long time job seeker
14 20 23.7 15.4 23.5 38.2 41 61 76 72 98 124 184
of woman
— — — — — — — — 8 840 1,721 2,187 1,434
new employment
Subsidy to SMEs changing

— — — — — — — — 17 121 152 114 50
into shift work plan
use of workers with — — — — — — — — — 92 385 549 419
special knowledge or skill
Other 6 12 149.4 153.3 146.2 216.6 316 265 499 880 3,006 4,715 5,362
* Subsidies to trainings to start new business, to adapt to his/her job, and to get a new job was abolished on 1 July
1998.
* Subsidy to encourage employment was abolished on 1 July 2001.
* Subsidy to promote employment of long time job seeker was replaced by Subsidy to encourage new employment
on 1 October 2004.

[Table -1-3] The amount paid under the JSP to the businesses classified by the
number of their employees
(unit: million won, %)
2002 2003 2004 2005 2006 2007 2008

Section

Amount Ratio Amount Ratio Amount Ratio Amount Ratio Amount Ratio Amount Ratio Amount Ratio
Total 117,944 100.0 112,705 100.0 140,995 100.0 267,684 100.0 608,181 100.0 988,236 100.0 825,778 100.0

Less than 10 15,120 12.8 13,801 12.2 17,874 12.7 77,369 28.8 164,095 27.0 218,120 22.1 160,695 19.5
10~29 16,722 14.2 18,857 16.7 16,079 11.4 38,192 14.3 63,275 10.4 83,761 8.5 72,058 8.7
30~49 7,484 6.3 9,610 8.5 9,819 7.0 14,399 5.4 24,486 4.0 31,058 3.1 27,747 3.4
50~499 31,080 26.4 31,439 27.9 33,269 23.6 50,893 19.0 67,894 11.2 66,983 6.8 66,448 8.0
500~999 4,638 3.9 4,333 3.8 5,035 3.6 7,119 2.7 8,076 1.3 8,168 0.8 9,169 1.1
1000 and over 15,007 12.7 13,533 12.0 14,932 10.6 14,109 5.3 47,154 7.8 32,974 3.3 39,031 4.7
Other businesses 27,893 23.7 21,132 18.9 43,987 31.1 65,603 24.5 233,201 38.3 547,172 55.4 450,630 54.6

[Figure 1] Amount of payments under the JSP over the years
(unit: JSP, year)
12,000
10,000
9,062
8,000 8,258
6,802
6,000
Appendix
4,000
2,677
1,975
2,000 1,257 1,471 1,179 1,127
1,099
65 122 1,410
0
1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008

Chapter 2 JOB CREATION ASSISTANCE
1. History and Purpose

Job Creation Assistance ‘
( JCA’) was created by an agreement signed by the
government, the businesses, and the labor on 10 February 2004, namely,“Social
Pledge to Create Jobs.”The plan was designed for the UI to increase its influence on
the labor market by assisting the businesses to create jobs. The plan introduced and
has implemented its programs since 2004.
2. Programs
A. Subsidy to assist the SMEs reducing working hours

This program is for businesses that have adopted 40 working hours per week program
early and increases the number of their employees. A total of 1.8 million Won per
person per quarter is paid until a law setting 40 working hours per week as legal
standard is promulgated. The subsidy pays up to 10% of the number of employees
worked in the business before the change was made. The limit has increased to 30%
from January 2009 by the amendment to the Act made in September 2008.
B. Subsidy for changing into shift work plan

This program is for the business owners who adopted shift work plan or changed the
shift work plan by increasing the shift units(up to 4 shifts) and hire more workers than
before the adoption or change the sum of 1.8 million Won(1.2 million Won for big
companies) per quarter per employee for 1 year.
C. Subsidy to SMEs for improving the work environment

This program pays SME owners who have invested more than 10 million Won in
order to improve the working environment and employs worker(s) half of the invested
amount (up to 50 million Won) and 120 million Won per employee for once.

D. Subsidy to SMEs for employing workers with special knowledge and/or
skills
This program is paid to the owners of manufacturing business or businesses that
provide knowledge based services who employ certified technician(s), and/or workers

having master or doctorate degrees in science and engineering to increase the

competitiveness of their businesses. The payment amount is 1.2 million Won for the
first 6 month and 600,000 Won for the second 6 months per person.
E. Subsidy to SMEs for entering into a new business area

This program pays owners of SMEs who enter into a new business area and create
job(s) by employing worker(s) the sum of 1.8 million Won per quarter per person for
1 year (abolished from year 2009).

3. Result and Evaluation
A. Subsidy to assist the SMEs reducing working hours
The payments made under this program are:
1 billion 657 million Won to 224 work places in 2004;

Appendix
4 billion 959 million Won to 681 work places in 2008.
Other programs under the JCP started in October 2004. However, actual payments
began to be made from 2005 using the intervening period for such works as receiving
applications and making evaluations. The payment made in 2005 was not significant
because the programs were not widely known as it was the first year, but has
increased rapidly from year 2006 as more business owners became aware of them.

B. Subsidy for changing into shift work plan
6 billion 233 million Won to 21 work places in year 2005;
12 billion 106 million Won to 52 work places in year 2008.
C. Subsidy to SMEs for improving the work environment

23 billion 188 million Won to 1,287 work places in year 2007;
27 billion 762 million Won to 1,470 work places in year 2008.
D. Subsidy to SMEs for employing workers with special knowledge and/or

skills
41 billion 938 million Won to 4,221 work places in year 2008.
E. Subsidy to SMEs for entering into a new business area

1 billion 798 million Won to 63 work places in year 2008.
The JSP plays a great role as one of important labor market policies with the
introduction of the JCAP.

Chapter 3 SUBSIDY TO ASSIST JOB ADJUSTMENT
1. Overview of the Plan

A. Purpose of job adjustment

Businesses want flexible human resources management system so that they can
respond the change of external environment and the change in the labor market
caused by industrial restructuring. Job adjustment includes human resources
adjustment and the business organization adjustment. Job adjustment is absolutely
required to survive in the international market where competition between businesses
is getting more and more intensive.
The change in global market draws more attention to the job adjustment among the

businesses. The change in the commodity market occurred because of the
development of technology and the global reach of the businesses. Further,
unpredictable changes in the foreign currency exchange rate also contribute towards
the changes in the market conditions. Businesses must increase productivity and
reduce costs in order to survive under such environment. They also have to equip
themselves with a system that produces multiple kinds of goods in small numbers.
Job adjustment is also another requisite for the businesses to survive in such business
environment.
Job adjustment adopts quantitative approach and qualitative approach. Quantitative

Appendix
approach comprises of means reducing the number of employees and means reducing
working hours. By reducing the number of employees, it can reduce new
employment, taking application for voluntary retirement, redundancy. Means
reducing working hours include restricting overtime working and temporary closing
down of the business. Quantitative adjustment uses relocation of human resources
such as relocation within the business and/or detachment. (refer to Table Ⅰ-3-1)

[Table -3-1] Types of Job Adjustment
I. Quantitative approach
1. Adjusting working hours
① Overtime work --------------- Restrict overtime work
② Normal working hours ------ Temporary closing down, more holidays
2. Adjusting the number of workers

① External means
Job vacancies --------------- Does not fill the vacancy or cut employment
New Employment --------- Reduce or stop employing new people
② Internal means
Irregular Employees ------- Discontinuing the employment of temporary
or part time workers or reducing their numbers
Regular Employees
Leading --------------- Taking application for voluntary retirement
Enforcing ----------- Redundancy
II. Qualitative approach

1. Within the business --------------- Relocation
2. Outside ------------------------------- Deployment
III. Other changes in the business organization ---------- Dividing into

other business entity, making workers small proprietors, business unit system,
sub-contracting, out-sourcing etc.
Job adjustment refers to the measures a business takes regarding the workers who
became redundant either reduce turn over caused by downturn or by introducing a
new technology and/or new machines into the business. The means includes: reducing
normal employees; reducing working hours; relocation; using more non-regular
employees such as temporary worker (or contract based worker), part time worker, or
deployed worker; and adopting diverse ways of production including petit-boss
system, outsourcing, and sub-contracting. The details of such job adjustment means
are as follows:

Detachment - sending the employee to another business or another work place of the
same business and have him/her work as instructed by the owner of the other business
or the other work place
Relocation - one manner of changing positions of the employees in the business. The

change includes the change in the kind, the contents, and the place of work as well as

the rank of the employee on long term basis.
Temporary closing down - ceasing operation of the business for a while for such
reasons as economic downturn. The contract is maintained and the parties suppose
returning to the work in the future.
Reducing the number of non-regular workers - Non-regular workers means

workers not in permanent employment. This manner of job adjustment takes such
measures as reducing the number of such non-regular workers as temporary (contract

based) workers and/or part time workers.
Redundancy - means dismissing multiple workers en masse either to get out of

serious hardship of the business caused by economic downturn or other reasons, or to
maintain or improve rationality in the management of the business.
Petit Proprietor - a petit proprietor in the narrow term means a person who used to
work in the work place as an employee would take over a production line or a part of
the production process and manages it as his/her own. The mother company leases the
equipment and provides material to the petit proprietor. The mother company also
provides such services as tax reporting, accounting, and contacting government
agencies so that the petit proprietor may concentrate on the production work. This is a
Appendix
form of production by sub-contract in the same work place. A petit proprietor in the
wide term includes the above explained and other small unit production methods
being widely adopted by businesses, big corporations in particular, including venture
capital, same business but separate accounts operation, co-op businesses by former
employees, production by sub-contract in the same work place, incorporation of a
division as a separate business entity.

B. The role of the subsidies in the job adjusting process
Job adjustment process takes the following steps:
① Reducing new employment and not employing substitute for vacancy by natural
causes such as retirement or voluntary resignation
② Reducing overtime work, reducing working hours, or suspending the business
③ Reducing temporary and/or part time workers, and accepting application for
voluntary retirement
④ Making redundancy upon consultation with the labor union or with the
representative of the workers
⑤ Making redundancy upon unilateral decision based on a certain standard set by
the owner when failed to reach an agreement with the labor union or the
representative of the workers.
[Table -3-2] Types of the subsidies to assist job adjustment

Subsidy for keeping jobs
Subsidies to assist job adjustment Subsidy to encourage job change assistance
Subsidy to encourage re-employment
2. Subsidy for Keeping Jobs

A. Purpose of the program
Skilled workers are important element of production in businesses. It takes many
years to train and nurture such a worker. It is not as easy to replace them as replacing
a machine. Dismissal of an employee to change the business structure must be used as
a last resort after exhausting all other measures such as selling real estates owned by
the business and/or reducing costs relating to materials. If it seems that dismissal of
an employee is unavoidable, the owner must try to obtain the employee’s
acquiescence in the situation leading to the decision.
The EI assist the business owners who are facing a situation where job adjustment looks
unavoidable but choose to keep their employees by adopting a certain measures. The EI
provides such business owners with part of the costs required to adopt those measures.

B. Contents of the program
Subsidy for keeping jobs ‘

( SME’) is composed of 4 types of subsidies as shown
below in Table -3-3.

[Table -3-3] Types of subsidies
Subsidy for business suspension

Subsidy for job training
Subsidy for Keeping jobs
Subsidy for approving leaves
Subsidy for relocation of human resources
■ Business suspension
Requirements
- The business owner must, in order to receive the subsidy;
prepare, in consultation with representative of the workers, a plan to maintain

employment(business suspension), and submit the plan to the local labor
department office before suspending his/her business;
suspend the business for more than 1/15 of the relevant calendar month to rest
the workers during the period and pay them allowances.
Amount of the subsidy

- The subsidy pays 2/3(1/2 for big corporation) of the total allowances the business
owner has paid during the suspension period.
Procedure
- The business owner who wants to receive the subsidy shall fill out the application on
Appendix
monthly basis commencing from the next month after suspending the business.
■ Job training
Requirements
- The training must be suitable for keeping jobs.
The curricula must be designed to assist job change, improving job capability, and
adapting to a new job

* Excluded programs: Programs awarding degrees to the graduates, supplementary education
required by law, ordinary job training as prescribed in the job description of the employee
- The education facilities must be separated from the work place and the education
must be conducted within normal working hours. The trainee should not be working
during the education period.
- Total training hours must exceed 4 hours per day, 20 hours in total
- The business may carry out the training by itself or delegate the trainees to job
training/education centers designated by the Minister of Labor;
- The business owner must prepare a plan to maintain employment(training) and
submit the plan to the local labor department office before commencing the
training/education

- The subsidy pays the employer 3/4 (2/3 for big corporation) of the wages he/she has
paid during the training period together and the costs related to the training.
Procedure
- The business owner who wants to receive the subsidy shall fill out the application on
monthly basis from one month after the training started.
■ Giving leaves
Requirements
- The business gives its employee(s) paid or unpaid leave of absence for more than 1
month.
* It is okay to provide training to the workers on leave.
- The business shall prepare, in consultation with representative of the workers, a plan
and submit the plan to the local labor department office before the leave starts.

- The subsidy pays the employer 2/3 (1/2for big corporation) of the allowances he/she
has paid the employees during the leave period in case of paid leave.

- The subsidy pays the employer the amount set down by the Minister of Labor in
case of unpaid leave. The Minister, when setting the subsidy amount, shall take the
costs of labor into account. The sum is currently set as 200,000 Won per person.

Procedure
- The business owner who wants to receive the subsidy shall fill out the application

accompanied by documents confirming that the leave has been given on monthly
basis one month after the leave started
■ Subsidy for relocation of human resources
Requirements
- The employer shall install new machines and equipments or renovate existing ones,
changes to a new business area, and deploy more than 60% of his/her existing

employees into the new venture.
* Business area change means moving to a business in another area under small or higher
classification of industries in the Korea Standard Classification of Industries.
- The business owner must prepare a plan(Relocation of Human Resources) and

submit the plan to the local labor department office. The plan shall record the
followings: the reasons, period, method of the change and the manner of paying and
utilizing the employees transferred into the new business.
- The business owner must complete the relocation of human resources within 1 years
and 6 months from the date the plan was submitted, and report what has been done to
the head of local labor department office. If the relocation is not completed within the
Appendix
prescribed period it shall be regarded to have been completed by the end of the period.

- The subsidy pays the employer 3/4(2/3 for big corporation) of the wages he or she
has paid after the relocation.

Procedure
- The business owner who wants to receive the subsidy shall fill out the application by
submitting copy of the wage payment account and an application for in the
prescribed form on monthly basis after the relocation of human resources has
completed.
- There must be tangible and physical investment for the change of business to be
acknowledged. Purchasing such goods as office furniture and/or commodities that
cannot be regarded as machines and equipments are not regarded as investment for
the change of business.
[Note] Duration of subsidy for keeping jobs
The subsidy for keeping jobs are paid to the employers who took such measures as
business suspension, job training, and giving leave in order to retain the employees up to
180 days including the day the measure was taken.
* It is possible to implement 2 more job keeping measures concurrently. The day when more
than 1 measure was taken shall be computed as 1 day.
C. History of the programs
1) Early days
When the plan was first employed, it only had subsidies for business suspension, for
relocation of human resources, and for training to change jobs only.

[Table -3-4] History of subsidy for keeping jobs
At the beginning May 1997 December 1997
Subsidy for business Subsidy for business Subsidy for suspension of

suspension allowance suspension allowance business

Subsidy for relocation of Subsidy for relocation of Subsidy for reducing working
human resources human resources hours

Subsidy for training to Subsidy for training to Subsidy for deploying
change jobs change jobs employees to other
Subsidy for training and businesses
education to start a business Subsidies for training to keep
jobs/relocation of human
resources
Subsidy for training to
change jobs
Subsidy for training and
education to start a business
July 1998 December 2000 January 2002

Subsidy for training to Subsidy for deploying Subsidy for leave allowance
change jobs and Subsidy employees to other Subsidy for reducing working
for training and businesses is abolished. hours
education to start a Amount of subsidy for Subsidy for training to keep
business are abolished keeping jobs is increased. jobs
Subsidy for giving leave Subsidy for leave allowance
is created Subsidy for relocation of
All programs are human resources
incorporated into
‘Subsidy for Keeping
Jobs’
February 2004 October 2004 January 2008

Appendix
Subsidy for business Subsidy for business Subsidy for business

suspension allowance suspension allowance suspension
Subsidy for training Subsidy for training Subsidy for job training
Subsidy for leave Subsidy for leave allowances Subsidy for giving leaves
allowances Subsidy for relocation of Subsidy for relocation of
Subsidy for relocation of human resources human resources
human resources Subsidy for changing into
shift work plan

2) First changes in the plan made on 1 July 1998
A change to the Regulations was planned for following reasons:
Subsidy for keeping jobs became more and more important after the Foreign
Currency Crisis as the number of unemployed was increasing;
There were public opinions saying that the assist plans should assume more roles
in order to keep more people employed.
Further, the plan being practiced at the time was not good enough to meet the request
of the time when dismissal in a large scale was expected as a big structural adjustment
was taking place upon announcement of names of the companies to be liquidated and
of the banks to be closed down, and big deal for business swap came into sight. There
was also criticism of the plan saying that it had too many programs so that people
were perplexed and the volume of the assistance was not big enough.
Economic circumstance of the Time

Companies to be liquidated named (55 businesses employing 23,410 workers)
- 19 June 1998 (4 Companies in Hyundai Group, 3 in Samsung, 5 in Daewoo) Banks to
be closed by restructuring of the banking industry named (5 Banks 9,604 workers)
- 29 June 1998 (Donghwa, Dongnam, Daedong, Kyeonggi, Chungcheong Bank)
The Regulations, amended and promulgated on 1 July 1998, has:

reduced the number of programs into 7 from previously existing 17 programs
under the Job Keeping Plan,
abolished subsidies for creating a business, for assimilation, and job changes
were abolished as they had poor track record of use and they can be covered by
current job capability development plan.
Other changes made to the plan the amended Regulations were:

Removed the difference in the level of assistance depending on whether the
recipient business was a designated business or not;
The amount of the subsidies has increased;
The requirements for the subsidy for reducing working hours were relaxed so that
businesses that reduced working hours on weekly basis can receive the assistance;
The payment was to be made every month.

The above changes have reduced the burden of the businesses that adopted job
keeping measures.

Amendments to the Employment Insurance Regulations on 1 July 1998
A. Merging the programs under the plan to assist job keeping into one and create a new

program namely, Leave assistance program
Subsidy for suspension of business

Subsidy for reducing working hours
Subsidy for deploying employees to other businesses Subsidy for
Keeping Jobs
Subsidy for training to keep jobs
Subsidy for relocation of human resources
Subsidy for leave allowance (new)

Subsidy for leave allowance pays for 6 months the employer 2/3(1/2 for big
corporation) of the allowances he/she has paid the employees during the leave
period in case of paid leave. In case of unpaid leave, 140,000 Won (110,000 Won
for big corporation) per person is paid.
B. Increase in the subsidy amount

The amount of the subsidies used to be different depending on whether the recipient was
a designated business or not.
Before After
Appendix
1/2~1/3 for designated businesses

2/3 for every business (1/2 for big corporations)
1/4~1/5 for other businesses
C. Relaxing the requirements and procedure of assistance

Payment interval is reduced from quarter to month.
Timeline to submit plan is extended from 3 days to 1 day before commencing the plan.

3) The second changes in the plan made on 1 October 1998
The Employment Regulations were amended again effective from 1 October 1998. The
amendment was based on evaluation of the programs up to the date. The changes were:
The required minimum period of reducing working hours to qualify for the
subsidy was reduced to 1 month from 3 months;
The employers who provide job trainings to their employees while they are on
unpaid leave are to receive subsidy for the costs relating to the trainings and for
the allowances they are paying to the employee/trainee in the amount of 70% of
the minimum wage and monthly travel allowance of 30,000 Won per person.
Further, for year 1999 only the period of the subsidy payment to keep jobs may be
extended up to 6 months when the Minister of Labor acknowledges that such
extension is necessary.
Amendments to the Employment Insurance Regulations on 1 October 1998
A. Requirements to pay the subsidies are relaxed

Before After
Reduce working hours by more than 1/10 Reduce working hours by 1/10 per day or by 8
for a period exceeding 3 months hours per week for a period exceeding 1 month
B. Subsidies are paid to the employers providing job training to the employees who take leave
The employers who provide job trainings to his or her employees while they are on
unpaid leave are to receive subsidy for the costs relating to the trainings and for the
allowances he or she is paying to the employee/trainee in the amount of 70% of the
minimum wage and monthly travel allowance of 30,000 Won per person.
C. The business owners who employ woman household heads who have family
members to support are to be assisted.
The business owner who gives a job to an unemployed woman who has registered to job
center to find a job and who, whether she is the family head or not, has family members
to support shall be subsidized 1/2 (1/3 for big corporation) of the wage paid to her for a
period of 6 months.

D. Temporary measures regarding the range of subsidy for keeping jobs
As subsidy for keeping job payment under the current plan is limited up to 6 months,
unless the economic conditions turns around, it is difficult to keep the employment which
was the purpose of the subsidy. As a temporary measure to address the problem, for year

1999 only the period of the subsidy payment to keep jobs may be extended up to 6
months when the Minister of Labor acknowledges that such extension was necessary.

4) Third changes in the plan made on 1 February 1999
Some changes to the plan were made because:
Temporary but radical increase of unemployment was expected in the first half of
year 1999 for such reasons as structural adjustment and seasonal factor;
new type of structural adjustment such as dividing a big corporation into small ones

emerged as a result of announcement of 5 big company groups plans for restructuring
themselves.
The change this time was oriented to regroup the programs in accordance with their
characters so as to construct an efficient system of job adjustment assist plan.
Amendments to the Employment Insurance Regulations on 1 February 1999
A. Subsidy amount for keeping jobs was increased
Division Before After

Appendix
Assisted only 1 job keeping Assists more than 2 job

Expanded assistance
program keeping programs
concurrently carried out
Payment period is amended 6 months 180 days
* The business owners who carry out a program under the plan during the first half of year
1999 shall receive assistance for extended period of 200 days.

B. Assisting a business being taken over by its employee
Requirements
An employee of a business takes over between 1 February to 31 December 1999 which

he had worked for and which was not able to avoid job adjustment for the reasons of
management, and satisfies the following requirements:
① the former employee who takes over the business must acquire more than 50% of
the share in the business;
② more than 60% of the employees who had been working for the business before
the take over shall be employed by the new management;
③ no dismissal of employee(s) by the management for the period of 3 months after
the take over;
④ the work place was where the EI applies.
Subsidy amount
Manufacturing business: Number of employees inherited with the business

800,000 Won (60,000 Won for big corporations)
Other businesses: Number of employees inherited with the business 600,000
Won (400,000 Won for big corporations)
5) Fourth changes in the plan made on 9 February 2000
Amendments to the Employment Insurance Regulations on 1 February 1999
A. The payment period clarification and extended
Division Before Now
180 days during the relevant

Clarifying the payment period 180 days
Insurance Year
Shall pay 90 more days if

Payment period for subsidy
up to 180 days training is given after
for job keeping (training)
exhausting 180 days payment
extended
of the subsidy

B. Limits to a number of subsidies are set
Subsidies to encourage new employment of the aged, long time job seekers, and woman
household heads are limited to 900,000 Won per month at the maximum.

C. Subsidy to encourage employment of long time job seekers extended

Division Before After
Payment period extended 6 months 12 months
D. Penalty for receiving subsidies on wrongful means increased
The person who receives the subsidy by provision of false information or by wrong
means shall not only return the subsidy he or she received but also pay penalty in the
sum equivalent to the amount as the money he or she received.
* This rule shall be applied to the person who received the subsidy by wrongful means after 1 April

2000. Those who voluntarily reported the wrongful conduct before receipt of the subsidy shall be
exempted from payment of the penalty.
6) Fifth changes in the plan made on 30 December 2000

This time, changes are made on the review that the JSP has:
assumed principal role as a social safety network when massive layoffs
were carried out as a result of foreign currency crisis of 1997 by preventing
unemployment and promoting re-employment of workers; but
been somewhat ineffective as emphasis was given on the expansion of the
Appendix
programs under the plan.
The changes are made with the following goals in mind:

improving protection of the vulnerable in the labor market;
achieving fairness in the size of assistance among corporations;
making the programs under the Plan more effective.

Amendments to the Employment Insurance Regulations on 30 December 2000
Important changes in the Subsidies for Keeping Jobs
Distinction Before After
Subsidy is paid when the

Subsidy for deploying employer, while maintaining
workers to outside work employment with an insured Abolished
place-abolished person of the EI, deploy
him/her outside his/her work.
Increased the subsidy

amount for job training 1/2~2/3 of the wage paid 2/3~3/4 of the wage paid
assistance
May not exceed 35,000 Won

Limit of the subsidy is set None
per person
Important changes to the subsidy to encourage employment of long time job seekers
and/or the aged people
Distinction Current Changes
Expanded the beneficiaries - people who are - people who used to be

of the subsidy to encourage unemployed for more than insured under the EI and at
employment of long time job 1 year after being present are being
seekers and/or the old aged dismissed from work unemployed for more than 6
people where the EI applies months after registering to
the Job Center etc to find a
- people who are being
job
unemployed for more than
1 year after registering to - people who were not insured
the Job Center etc to find a under the EI and after having
job been introduced to a job
once in 3 months during 6
month after registering to
the Job Center etc to find a
job AND but remaining
unemployed

Distinction Current Changes
Tightening the qualification - Employ more than 1 aged - Employ the aged as insured
requirements for subsidy to worker persons under the EI and
encourage new employment who are being unemployed

of the aged for more than 3 months after
registering to the Job Center

etc to find a job
Payment amount for subsidies fixed
Name of subsidy Before After
Subsidy to encourage - mass employment: 90,000 - 150,000 Won per quarter

employment of the aged Won per quarter - 260,000 Won per month for a
- new employment: 1/3~1/4 period of 6 months
of wages for a period of 6 - 300,000 Won per month for a
months period of 6 months

- re-employment: payment
of 0.8~1.6 million Won for
once
Subsidy to encourage - woman household head: - 500,000 Won per month for a
employment of woman 1/2~1/3 of the wages paid period of 6 months
- re-employment: payment - 300,000 Won per month for a
of 1.2~2.0 million Won for period of 6 months
once - 200,000 Won per month
- Child care leave: 150,000
Won per month (big
corporations: 120,000 Won)
* Subsidy to encourage employment was abolished from 1 July 2001.

Appendix
7) Sixth changes in the plan made on 7 July 2001

Subsidy to encourage assistance to job change is created.
The requirements to apply for the subsidy to encourage employment of long time
job seekers are relaxed

- People who were not insured under the EI and after having been introduced to a
job once in 3 months during 6 month after registering to the Job Center etc to
find a job BUT still unemployed may be subject to the subsidy regardless of the
time of employment or the time of the last introduction to a job if the employer
employs the person through the Job Center.
8) Seventh changes in the plan made on 23 July 2001

The standard of when job adjustment is unavoidable is changed;
from the month when the adjustment is made,
to the previous month of such action.
The requirements to receive assistance for job retention training is relaxed;

from provision of training for 4 or more hours per day, 30 or more hours in total,
and continuing more than 1 week,
to provision of training for 4 or more hours per day and 20 or more hours in total.
The institutions introducing jobs to long time job seekers are expanded so as to be the
same as those under the Subsidy to encourage re-employment which includes the
Human Resources Development Service in Korea and the Korea Employment
Promotion Agency for the Disabled.
The target of the subsidy to encourage employment of woman household head is

made clear by setting the scope of a woman household head under the program.
The grounds of paying wages to the teachers of work place child care centers are
established and the requirements for such support are clarified. The matters related to
assist the work place child care center used to be prescribed but now changed to be
governed by a bylaw. The number of children of the insured by the EI at the end of
each quarter is used as the basis of calculating the amount of the payment.
The penalty for wrongful conducts is reduced. The amount of penalty is from now on
100/100 of the amount of the subsidies the business owner have received by using
false information or other wrongful means.

9) Eighth changes in the plan made on 25 February 2004
The program to assist reduction of working hours, which was one of the subsidizing
programs for employment retention, is abolished and incorporated to the subsidy for
suspending business. Suspension of business for less than 2 hours a day is now not

regarded as one day of suspension. When the suspension is part of the ordinary
working hours of the work place, the business suspension day is computed by

dividing the hours the business is suspended by the ordinary working hours.
10) Ninth changes in the plan made on 1 October 2004

Change of the shift plan is introduced as a program for employment retention. The
business owners who retain employment by increasing the number of shifts at his
work place can receive the subsidy.

11) Tenth changes in the plan made on 1 January 2008
Change of the shift plan is no more recognized as a program for job retention.
D. Results
The subsidies for employment retention have been paid as follows:

32 billion Won in year 2004;
30.9 billion Won in year 2005;
Appendix
30.6 billion Won in year 2008.

[Table -3-5] Annual payments of the subsidies for employment retention
(unit: million won)
Distinction 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008
Number of
2 3 5 4,220 7,126 3,466 8,027 4,176 4,590 4,629 4,519 4,434 4,425 4,274
payment
Number of
- - 471 654,375 370,831 148,499 257,431 152,384 119,127 104,124 97,962 92,545 84,856 88,012
recipients
Amount paid 6 16 42 74,223 79,427 29,399 55,977 32,729 27,388 32,047 30,919 33,565 32,533 30,642
[Table -3-6] Payments made under each program in the plan

(unit: million won)
Distinction 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008
Total 74,223 79,427 29,399 55,977 32,729 27,388 32,046 30,919 33,565 32,533 30,642
Business suspension 53,331 47,373 21,837 32,234 19,904 21,138 23,760 25,110 23,854 24,580 24,545
Training 15,668 16,480 3,492 12,836 7,122 2,945 2,901 2,292 2,514 2,686 1,644
Working hours
reduction 566 717 74 185 14 81 65 - - - -
Leave 3,372 13,023 3,251 9,973 5,191 3,015 5,303 3,411 7,105 4,825 4,036
Outside deployment 802 1,118 92 15 - - - - - - -
Relocation of human
resources 484 394 453 547 404 209 17 106 92 442 417
Employee taking over - 322 200 187 94 - - - - - -

change of shift plan - - - - - - - - - - -
* Employee taking over: applied until December 2001, Working hour reduction: abolished in February 2004,
Outside deployment: abolished in December 2000, change of shift plan: applied up to December 2007
3. Subsidy to Encourage Job Change

A. Background
Now Korea has entered into an era when job adjustment is constantly happening.
However, the job adjustment practice until recently is focused only on‘Redundancy’
.

The issue of assisting people with their re-employment attracted not much attention.
Following the footsteps of such other developed countries as the US and Japan, a plan
was on July 2001 to set up programs to assist people who are to be out of current
employment shortly to find a new job

B. Who are the beneficiaries

The subsidy to encourage job change is paid to the business owner who;
submits a plan to assist his/her employees with their change of jobs,
has obtained approval of the plan, and
provides job change services in accordance with the plan.
C. Requirements of the subsidy payment

The followings are the requirements to receive the subsidy:

① The service shall be carried out by the business owner who is not able to avoid
restructuring of his/her business towards his/her employee(s) who is about to leave
the job or has left the job because of job adjustment, retirement, or expired labor
contract.
* Leaving the job because of job adjustment means dismissal, voluntary retirement, and
resignation upon suggestion made by the need of the management of the business.
② There shall be a consultation between the labor and the management regarding the
service to assist change of jobs.
③ The business owner shall prepare a plan to assist job change, and carry out the
Appendix
plan.
④ The business must be equipped with separate facilities to assist the job change.
* The facilities shall be prepared by the business owner in case he/she provides the assistance
service, and by the institution when the service is delegated to the institution.
⑤ The plan shall provide the service to assist job change as prescribed by the
Regulations made by the Ministry of Labor.

D. What is subsidized
1) When the business owner provides the service to assist job change:
Such expenditures as wages, rent for office equipments such as computers in case
they are leased, administration costs for the facility, costs of training and education,
and any other costs related to the job change assisting service are subsidized.
* However, any of the above costs that are subject to the subsidy under the Job Competency
Development Plan in accordance with the provisions in chapter 3 of the EIA shall be excluded from
being subsidized under this plan.
2) When the service is delegated to a professional consulting agency:

The costs related to the service carried out by a professional consulting agency, when
the service is delegated to the agency, shall be perused and the sum recognized as
having been spent due to the service shall be subsidized.
* However, any of the above costs that are subject to the subsidy under the Job Competency
Development Plan in accordance with the provisions in chapter 3 of the EIA shall be excluded from
being subsidized under this plan.
E. The volume and the period of subsidy

1) Subsidy amount: All of the costs spent (big corporations 2/3)
2) Subsidy limit: The ceiling shall be the amount as calculated by multiplying
3 million Won to the number of people who used the service.
3) Subsidy period: Each of the services to assist job change shall receive the subsidy
for up to 12 months.
F. Application procedure
Submit the plan for the service - approval - carry out the service - apply for subsidy -
payment
① Submission of the plan for the service to assist job change

The plan shall contain:
The reason of job adjustment, the number of targeted people, details of the program,

the period and expected costs of the service (in case of delegation to a professional
agency: the name of the agency and the costs to be paid to the agency)
The plan must be accompanied by a written consent of the representative of the
workers.

② Approving the plan

The plan shall be approved by the local labor ministry office. When it is done, the
local office gives notice of approval to the owner.
③ Carrying out the program and applying for the subsidy

The owner shall carry out the service first, in accordance with the approved plan, and
then fill out the application for the subsidy in the next month. The application shall
contain: name of the participants to the service, result of the service, and details of
expenditures together with supporting documents.

④ Paying the subsidy
The subsidy shall be paid after confirming correctness of the information contained in
the application for subsidy.
G. Results
The subsidy for the service to assist job change was paid 1.4 billion Won in year
2004, 1.5 billion Won in year 2005, 1.5 billion Won in year 2006, 2.4 billion Won in
year 2007, and 1.5 billion Won in year 2008.
[Table -3-7] Annual subsidy payments under the job change assistance program
Appendix
(unit: million won)
Distinction 2001 2002 2003 2004 2005 2006 2007 2008
Cases 5 21 16 31 28 38 21 29
Number of participants 679 7,408 583 2,696 1,440 1,845 1,875 1,482
Amount paid 43 432 641 1,428 1,514 1,522 2,441 1,531

4. Subsidy to Encourage Re-Employement

This program was designed to encourage re-employment of the workers who were
laid off when the businesses they had worked for were experiencing hardship but
have become necessary again after economic recovery. It was expected that this
program would make the demand and supply mechanism of the human resources
more effective and increase mobilization of work force. However, it did not meet the
expectation. There were not much demand for the subsidy and it was evaluated that
the program is not effective.
This program pays subsidies to the business owners who re-employ the workers who used
to work for them. The details of the subsidy payments under this program are as follows:
1) Requirements for the payment
① The business owner must re-employ the worker(s) who was made redundant by
him/her within the period between 6 months and 2 years before layoff.
* The subsidy for re-employing the workers who left the job for pregnancy, childbirth, and
childcare was abolished from 1 January 2008.
② This program does not regard part time employment or fixed term employment as
re-employment.
* However, in case of re-employing a person who was a recipient of the subsidy in the same work
place within the last 2 years, the business owner who dismissed his/her employer(s) between 3
months prior and 6 months after the re-employment shall be excluded from the assistance.
2) Payment Amount
The subsidy amount under this program is 400,000 Won (300,000 Won for big
corporations) per each re-employed workers for 6 months.
3) Procedure
The person who wants to receive the subsidy must fill out application monthly or
quarterly by submitting an application on the prescribed form together with the wage
payment record.

4) Results
The subsidy to encourage re-employment was paid 300 million Won in 2004, 800
million Won in 2005, 900 million Won in 2006, 800 million Won in 2007, and 700
million Won in 2008.

[Table -3-8] The amount paid as the subsidy to encourage re-employment

(unit: million won)
Distinction 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008
Cases 95 461 277 191 141 154 1,556 1,789 1,741 1,169
Number of participants 268 746 394 270 408 175 1,867 2,260 2,084 1,704
Amount paid 517 1,423 766 506 734 330 770 890 821 696
* The application term was changed in June 2007 from monthly to monthly or quarterly.

Chapter 4 SUBSIDY TO ENCOURAGE EMPLOYMENT
1. Purpose
A. Increasing use of human resources in the aging society
Businesses in an era of declining work force need active rationalization in order to
improve their productivity and management effectiveness. As, since it is expected that
the productive population is going to decrease from 2016 and the total population
from 2020, businesses must increase their competitiveness by actively utilizing the
Appendix
aged work force. The subsidy to encourage employment is created to encourage

businesses to employ more aged workers. It pays subsidies to the businesses that
employ the aged in more than a certain portion, continue employing the aged, and
re-employing the aged.
The aged themselves must endeavor to improve their job skills, and assume positive
attitude towards working.

B. Improving use of human resources under the increasing number of
long time job seekers
Among those who lost their job after the Foreign Currency Crisis of 1997, many
remained unemployed for a long period. The percentage of people who are
unemployed for more than 1 year among total unemployed reached 16.5% in the first
half of 1999. The long term unemployment has become a social problem. The subsidy
to encourage employment of long time job seekers was established against such
background in July 1999. The program was designed to encourage employment of
long time job seekers. The program was not much of use in years 1999 and 2000. The
government made changes to the Regulations on 30 December 2000 in order to relax
the requirements for application. Since then, this program is making a lot of
contributions towards employment of the long time job seekers.
C. The environment surrounding female workers and the use of female

work force
The ratio of woman’s participation in the economic activity is low. Further, those who
take part in the economic activities have hard time to continue working because of
childbirth and childcare, etc. Women are important human resources. It is necessary
first to activate the means designed to achieve the balance between work and life such
as childcare leave and, secondly, to set up plans that may make the return of woman
workers to their work places who had left their job for such reasons as childcare.
Further, a special consideration is required for those woman household heads who
assumed the responsibility to financially support her family as their husband cannot
work because of illness or injury.
D. Increasing the assistance to encourage employment of the vulnerable
As described above, the subsidy to encourage employment so far was operated

separately under such names as subsidy to encourage the aged, the subsidy to
encourage the long time job seekers, and the subsidy to encourage employment of

woman household head. As a result, it was difficult for the business owners to
comprehend the plans. Further, there was inconsistency in the period and the amount
of the subsidy payments among the programs that caused confusion to the users. In
order to address such problems, the Employment Insurance Regulations were

amended in October 2004.

The amendment made has;
incorporated all subsidies to encourage employment into subsidy to encourage
new employment,
made the period and amount of the payments under each program the same, and
expanded the beneficiaries of assistance to include the unemployed youth and the
disabled.
2. Contents of the Plan

The EI has a number of programs designed to extend job opportunities and to provide
economic support for the aged, long time job seekers, and woman who find it
difficulty to get employment in the ordinary labor market.
The plan pays the subsidy to encourage employment of the aged. It is for the business
owners who employ the aged over a certain ratio, continue employing old people, or
re-employ the aged.
The plan has a subsidy to encourage employment of woman and the program to
encourage to continue employing female workers after their pregnancy and childbirth. Appendix
3. Subsidy to Encourage Employment of the Aged
A. Purpose
It is very important to give the aged the opportunity to work in this era when the
population of the aged is increasing because employing the aged has the social benefit
of using more human resources and providing means of living.

B. Contents of the plan
Distinction Requirements Subsidy amount
Subsidy to The business owner who employs the aged so 150,000 Won per person
encourage that the ratio of the old employees against the per each quarter for the
employment total employees exceeds a certain threshold set number of employees
of the aged to his/her business area exceeding the set
in large * 4% for manufacturing, 42% for real estate business, threshold for 5 years
number service industries selected for the assistance 17%, - Up to 15% of total
other businesses 7% employees in each
- The following are excluded when counting quarter (10% for big
the number of the aged employee or total corporations)
employee: daily workers who are employed
for less than 1 month, the workers who
works less than 60 hours per month (15
hours per week, and public servants)
Subsidy to The business owner who continues to employ 300,000 Won per the re-
encourage the workers who reached the age of retirement employed or the
continuous or re-employ within 3 months from retirement continuously employed
employment the workers who have retired from work and worker
of retirees the retirement age in the work place is higher for 6 months
than 57 years. - 12 months for
- Subsidy shall not be provided if the manufacturing business
continuous employment lasts less than 1 year with less than 500
or the retirement age was reduced within 3 employees
years before the continuous employment.
- Subsidy shall not be provided if the business
has dismissed its employee(s) by job
adjustment during the period starting from 3
months before and ending 6 months after the
employment of the employee who reached the
retirement age
Subsidy to The retirement age in the work place is extended 300,000Won per person
encourage by more than 1 year, and the extended for half of the extended
extension of retirement age of the work place is higher than period
the retirement 56 years
age The retirement age of the work place must be set
by the rules of employment or the collective
bargaining agreement of the work place. The
customary retirement age is not recognized.
The work place which had reduced the
retirement age within 3 years before extending it.

C. The history of the plan
1) The first change of the plan made by amendments to the regulations on 1 July 1999
The requirements to receive the subsidy are relaxed so as to assist more aged people
to get a job.

Changes made on 1 July 1999

New Employment of the

aged
- requirements for the More than 5 people per quarter More than 1 person per month
subsidy payment are or more than 5% of total
relaxed employees
- amount of the subsidy 1/4~1/5 of wage for 6 months 1/3~1/4 of wage for 6 months
payment is increased
Re-employment of the

old
- the age range of the 45~55 years old 45~60 years old
target employee is
expanded
2) The second change of the plan made by amendments to the regulations on 30

December 2000
The changes made to address abuse of the plan. Such business owners employed
other employee than the employee whose employment contract had expired in order
to receive the subsidy.
Appendix

Changes made on 20 December 2000
New employment of the - Employing more than 1 old - Employing the aged person
aged people who has registered at a Job
Center but remained
unemployed for more than 3
months as an insurer of the EI
-1/3~1/4 of wage for 6 months - 250,000 Won for 6 months
Employment of the aged 90,000 Won per quarter 150,000 Won per quarter
in large number
Re-employment of the - payment of 800,000 ~ - 300,000 Won for 6 months

aged 1.6 million Won for once
3) The third change of the plan made by amendments to the regulations on 25

February 2004
The plan was changed to reduce the number of cases in which the subsidy was taken
by the business owners. The changes made were:
tightening the requirements for the subsidy for mass employment of the aged;
expanding the object of the subsidy for new employment of the aged;
abolishing the subsidy for re-employment of the aged;
introducing the subsidy for mass employment of the aged.

Changes made on 10 March 2004
Employment of the aged - Required ratio of the old - The required ratio
in large number aged employees among total differentiated among

employees was 6% industries * * 4% for
throughout all industries manufacturing, 42% for real
estate business, service

- age over 55 years industries selected for the
assistance 17%, other
businesses 7%
- no limit to total payment - Limit to the payment period is
period set as 5 years in total
New employment of the - people aged between 55~59 - people aged between 50~64
aged years years
- unemployed period exceeds - unemployed period between 1
3 months and 3 months
- 280,000 Won for 6 months - 300,000 Won for 6 months (12
months for manufacturing
business with less than 500

employees)
Continuous employment [ new ] - The business owner who

of retiring worker continues to employ the
workers who reached the age
of retirement or re-employ
within 3 months from
retirement the workers who
have retired from work and
the retirement age in the work
place is higher than 57 years.
- 300,000 Won per the re-
employed or the continuously
employed worker for 6
months (12 months for
manufacturing business with
less than 500 employees)
Appendix
Re-employment of the - Employment of workers of the

aged age between 45~59 years
- Re-employment between 3
months and 2 years period of
retirement
- 330,000 Won per month for 6
months

4) The fourth change in the plan made by amendments to the regulations on 17
October 2007
The subsidy to encourage extension of the retirement age was introduced into the plan
on 17 October 2007. However, it has taken effect on 1 January 2008.
D. Result and evaluation
It is expected that the plan will play a more important role in expanding employment
opportunities and welfare of the aged, and to reduce the hardship of the business
owners in recruiting because the ratio of the aged among total population is
increasing.
The subsidy was paid to 273,945 people in 50,023 businesses. A total of 48,062
million Won was paid. The amount paid as the subsidy to encourage continuous
employment of retirees shows steady increase from its introduction in February 2004:
1,223 million Won in 2005, 1,764 million Won in 2006, 2,492 million Won in 2007,
and 2,626 million Won in 2008.
[Table -4-1] Annual payment of the subsidy to encourage employment of the aged
(unit: million won)
Distinction 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008
Number of businesses 35,751 50,466 61,790 66,565 70,793 63,972 48,760 48,424 53,691 54,023
Number of recipients 189,146 225,711 251,870 270,902 308,874 266,119 218,072 229,092 259,357 273,945
Amount paid 25,450 36,758 41,620 39,980 46,236 41,299 33,988 36,025 40,880 48,062
The allowance to supplement the peak wage plan, which was introduced as a
temporary program to be expired in 2008, was changed to a permanent program in
2008 by amending the Employment Insurance Regulations. Further change was made
so supplementary allowance can be paid when the wage was reduced by reduction of
the working hours by amending the Enforcement Regulations for the Employment
Insurance Act on 19 September 2008.

4. Allowance to Supplement the Peak Wage Plan
The peak wage plan is a type of employment whereby the worker receives less than

their peak wage after passing a certain age. It used to be the case that the aged were
the first target when his/her employer needs job adjustment because the wages were

usually set to increase on yearly basis. The peak wage plan was introduced to turn
around such trend and provide the aged with secure employment as well as reducing
the wage pressure on the businesses. This program pays 50% of the reduced amount
of the wage of the workers take part in the peak wage plan. It is provided to a worker
whose employer guarantees his/her employment to a certain age of over 56 and the
reduction amount is more than 10% of his/her peak wage.

The contents of the allowance payment program to supplement the peak wage plan
Requirements to receive the allowance Level of payment
The workers under the following category The allowance amount is 50/100 of the
are qualified to receive the allowance: difference between the worker’s peak wage
and the current year’s wage with the ceiling of
�54 years of age or older; 6 million Won per year (1.5 million Won per
�has been working for more than 18 months quarter. However, the sum of his wage and
at a work place where the peak wage plan the allowance may not exceed 57 million
is adopted by mutual agreement of the 600,000 Won per annum (14 million 400,000
labor and the management; Won per quarter)
Appendix
�his/her wage has dropped, as a result of

* The allowance shall not be paid to the worker who
joining the peak wage plan, by more than receives more than 57 million 600,000 Won per
10% compared to the peak wage he had annum as reduced wage.
received.
* The allowance shall be paid up to 6 years.
* The employment must be kept until 55 years of
age in years 2006 and 2007, until 56 years of
age in year 2008.

C. History of important changes of the program
When the program was first introduced in 2006, the upper limit of the wage to receive
the allowance was set at 46,800,000 Won per annum using the wages of the top 10%
of the workers in the country. However, it was not good enough to cover the aged
workers who were paid more. The plan did not contribute much to the extension of
the peak wage plan. The Ministry of Labor surveyed twenty three work places that
had adopted the peak wage plan but did not apply for the allowance in August 2006.
The survey showed that workers at 16 work places (69.6% of the surveyed work
places) were not able to apply for the allowance as their reduced wages exceeded the
threshold of 46,800,000 Won per annum. The government amended the guideline in
March 2007 and increased the threshold amount to 57, 600,000 Won per annum using
wage of top 10% of the workers of the age between 55 and 59. (The threshold had
been once raised before in 2005 to 50,580,000 Won.)
[Table -4-2] The wages paid in the businesses in 2005

(unit: 10,000 won)
Age group Average P50 P60 P70 P80 P90
All workers 2,800 2,324 2,732 3,218 3,868 5,058
55~59 years old workers 2,675 1,769 2,116 2,682 3,593 5,752
* source: 2005 survey of primary statistics on wage structure
D. Results and evaluation

The plan has short history as it was first introduced in 2006. The payment amount is
increasing. Only 9.8% of the budget was executed in 2006. The allowance payment
made in 2007 was 1 billion 538 million Won, being 19.5% of the budget of 7.9 billion
Won. The allowances were paid to 584 workers in 214 work places in 2008, and the
amount paid was 3 billion 32 million Won, taking up 90.2% of the budget. However,
the number of businesses with 100 or more workers that have adopted the peak wage
plan have not increased over the years. They were only 2.3% in July 2005, 4.4% in
July 2006, and 5.8% of total work places employing more than 100 workers.

It was analyzed that the peak wage plan was not popular because both the labor and
the management regard the plan as a means to reduce wage or to adjust jobs. It was
also analyzed that the allowance, because it was not well publicized, did not
contribute toward the expansion of the peak wage plan. Another barrier to the

expansion of the peak wage plan was one of the requirements to receive the
allowance, namely, the requirement that the wage peak plan must have the consent of

the representative of the workers when adopted into the work place. An amendment
to the plan is under process at the moment to remove this barrier. When the
amendment is effective, the allowance will be given if the peak wage plan was
adopted with the relevant employee’s consent if the consent to the plan by the
representative of the worker’s consent was given when the plan concerns employment
after retirement. An act containing the amendment, namely,‘the Act to prohibit
workers on the ground of his/her age and to promote employment of the old aged
people’was produced to the Environment and Labor Committee of the National

Assembly on 28 April 2009.
[Table -4-3] Annual payment of the allowance to supplement the peak wage plan
(unit: million won)
Distinction 2006 2007 2008
Work places 37 160 214
Workers 226 584 997
Amount paid 579 1,538 3,032
5. Subsidy to Promote Childcare Leave

Appendix
The female workers are important for the economy these days as the demand for them
is increasing because of declining childbirth, rapid aging of the population and high
level education the women are receiving. It is usual for female workers to get out of
the labor market due to marriage and childbirth, and return to employment after

upbringing of their children is complete. However, it is difficult for the returning
female workers to find jobs matching their knowledge and experience. As a result
many of such women either give up working or settle with irregular employment
which requires simple unskilled labor. It is necessary to provide social assistance for
female workers to continue their participation in the economic activities. The subsidy
to promote childcare leave is introduced to meet such needs. The subsidy is designed
to assist the employers with the costs to maintain employment while the female
employees take childcare leave or work reduced hours to take care of their babies.
The cost required to maintain employment includes premiums of social insurances
and the expenses related to employment of the replacement worker.
The subsidy is paid to the business owners;

who give childcare leave to the employee or reduce working hours of woman
workers with baby child for the period exceeding 30 days,
employ continuously female worker for more than 30 days.
The employee taking the leave or subject to the working hour reduction must be an
insurer of the Employment Insurance. The payment amount is 200,000 Won per each
worker per month.
On top of the childcare leave subsidy, subsidy to encourage employment of substitute
workers is paid in the sum of 200~300,000 Won for each substitute worker who was
employed to fill in the position of the worker who took the childcare leave and
maintain the employment for more than 30 days after return of the worker who had
taken the childcare leave.

[ The details of the subsidy to promote childcare leave ]
Distinction Requirements Payment amount
Subsidy to promote The business owner who gives The subsidy is paid to the
childcare leave his/her workers, who are insured to business owner who gives

the Employment Insurance, the his/her employees the childcare
childcare leave for more than 30 leave a total of 200,000 Won per
month for each employee taking
days period and employs the worker

the leave.
for more than 30 days when the
childcare leave is over.
subsidy to The business owner who employs 200~300,000 Won per month
encourage substitute workers to fill in the per each substitute worker
employment of positions of the workers who are
replacement taking childcare leave, and
workers re-employs the workers when the
leave ends.

C. Results and evaluation
This subsidy shows steady payment record since its introduction in 1995. The
monthly payment amount per each worker was; 80~120,000 Won in year 1995 which
was the first year of its commencement, 90~135,000 Won in year 1997, 110~140,000
Won in year 1998, 120~150,000 Won in year 1999, and continues paying 200,000
Won from year 2001 to year 2007.
The subsidy for substitute workers has been paying the sum of 100~150,000 Won per
month per person since its promulgation on 25 February 2004. The payment amount
has increased to 200~300,000 Won per person per month on 1 January 2006 upon
Appendix
amendment to the Employment Insurance Regulations.

[Table -4-4] Annual payment amount of the subsidy to promote childcare leave
(unit: million won)
Distinction 2001 2002 2003 2004 2005 2006 2007 2008
1,551 2,011 2,424 3,754

Work places 542 461 802 1,330
(55) (194) (1,601) (2,555)
4,594 6,436 7,761 11,780
Workers 3,136 2,227 3,877 4,561
(58) (466) (796) (581)
7,217 9,815 12,373 18,378
Payment amount 2,804 2,836 5,255 6,733
(64) (392) (1,154) (2,488)
*( ) : The subsidy to encourage employment of substitute workers
6. Subsidy to Encourage Employment of the People Completing

the Training for Middle and Upper Middle Aged Workers
This subsidy is paid to the business owners who employ people of over 40 years of
age and having completed the training for job changing unemployed or similar. This
program was designed;
to ease the hardships the SMEs are facing in recruiting workers,

to assist unemployed workers of 40 years of age or over to find jobs quickly,
to make the trainings for unemployed people more productive.
However, this program was abolished from year 2009 as it did not attract many
applications.

The subsidy is paid to the business owners who employ the unemployed people of the
following qualifications:
40 years of age or older,

have completed one of the job training courses designated by the minister of
labor.
The employment must take place with in 6 months from his/her completion of the
training. The payment is for total period of 1 year, comprising 600,000 Won for the

first 6 months from the employment, and 300,000 Won for the second 6 months.

C. Results and evaluation
It was evaluated as having contributed towards employment of the vulnerable by

connecting the Job Security Plan and the Job Competency Development Plan. The
payment amounts were: 153 million won in 2003, 379 million won in 2004, 615
million won in 2005, 966 million won in 2006, 1,825 million won in 2007, and 1,706
million Won in 2008.

7. Subsidy to Encourage New Employment
A. Purpose of the plan
The JSP was comprised of a number of programs. The programs included the subsidy
to encourage new employment of the aged people, the subsidy to encourage new
employment of woman household heads, and the subsidy to encourage employment
of long time job seekers. Such separation of programs caused trouble to the business
owners to understand them as their requirements, payment amounts, and payment
periods are different from each other. The government has merged all four programs
Appendix
into one program namely, the subsidy to encourage new employment by amending the
EI Regulations in October 2004. The program has extended its application to young
unemployed people and the disabled people. Female workers who had left their job
because of pregnancy or childbirth also had come under the programs umbrella. Later,
more detailed definition of the young employed people and the woman household
head on the recognition of such problems as loss in the hands of the owner and too

wide application. The young unemployed people are defined to be those 29 years and
under who are experiencing difficulties in finding a suitable job, and woman
household heads are defined as those who are subject to the employment in the Act to
provide basis livelihood to all citizens, and subject to protection in the Act to assist
single parent family. Those changed improved the program’s productivity.
The business owners who employ through the Job Center the workers registered there
for more than certain period to seek jobs. The required period differs depending on
the qualification of the worker. The subsidy amount is 150~600,000 Won per
employed worker per month. The subsidy is paid for 1 year for each employment.
[Table -4-5] Required unemployed period to receive the subsidy to

encourage new employment
Workers to be assisted Unemployed period
1. The people who meet the criteria set by Order of the Minister of 1 month
Labor made considering the income and the ability to get job
among the aged people as defined in section 2 subsection 1 of the
‘Act to prohibit discrimination on the ground of age and to promote
employment of the old aged people’, and semi-old people as
defined in section 2 in the same Act.
2. The unemployed women who are responsible for family livelihood

(as defined by the Regulations of the Department of Labor), and
either are subject to employment in Regulation 11 sub-regulation 2
in the‘Regulations for the Act to provide basic livelihood to all
citizens’or subject to protection as determined in section 5 and
section 5 subsection 2 in the‘Act to assist one parent family’
3. People with severe disability as defined in section 2 subsection 2 of

the‘Act to promote employment of the disabled and job
rehabilitation’

Workers to be assisted Unemployed period
4. The aged people as defined in section 2 subsection 1 of the‘Act to 3 months

prohibit discrimination on the ground of age and to promote
employment of the old aged people’, and semi-old people as

defined in section 2 in the same Act, except those come under item
1 above.

5. 29 years old or younger people who are having difficulties in finding
job because of low level of education and lack of skills and
experiences and satisfies the criteria prescribed by the Minister of
Labor
6. People with disability as defined in section 2 subsection in the‘Act

to promote employment of disabled people and job rehabilitation’,
except those come under item 3 above
7. People who are subject to employment in accordance with section

11 subsection 2 in the‘Enforcement Decree for the Act to provide

basic livelihood to all citizens’
8. Woman workers who left job because of pregnancy, childbirth, or

childcare
9. Farmers and Fishers who receive or had received the subsidy for
closing business in accordance with section 6 in the‘Special act to
assist farmers and fishers upon entering into the Free Trading
Agreement’
10. People who are not subject to items 1~9 above 6 months
[Table -4-6] Subsidy amount for each category of recipient

Appendix
Workers to be assisted Subsidy amount
The aged and people who (1) 300,000 won per month for the first 6 months after
should be regarded as the employment, and 150,000 won per month for the next six
aged as defined in the‘Act to months
promote employment of the
aged people’

Workers to be assisted Subsidy amount
(2) 600,000 won per month per person for the first6 months
after employment, and 300,000 won per month for the next
six months when the work place meets the criteria set in
Regulation 12 Sub-regulation1(2) of the Employment
Insurance Regulations (i.e., in the manufacturing business
and has less than 500 employees)
Disabled people as defined (1) 600,000 won per each disabled person with severe
in the Act to promote disability as defined in section 2 subsection 2 of the‘Act to
employment of disabled promote employment of disabled people and job
people and job rehabilitation rehabilitation’per month for 12 months
(2) 600,000 won per month for the first 6 months and 300,000
won for the next 6 months per each disabled person other
than the severely disabled
29 years old or younger (1) 450,000 won per month for the first 6 months after employment,
people who are having and 300,000 won per month for the next six months
difficulties in finding jobs (2) 600,000 won per month per person for the first6 months
because of low level of after employment, and 300,000 won per month for the next
education and lack of skills six months when the work place meets the criteria set in
and experiences (limited to Regulation 12 Sub-regulation1(2) of the Employment
the work places to receive Insurance Regulations (i.e., in the manufacturing business
prior assistance) and has less than 500 employees)
The unemployed women who 600,000 won per month per person for the first6 months after
are responsible for family employment, and 300,000 won per month for the next six
livelihood (as defined by the months
Regulations of the Department
of Labor), and either are
subject to employment in
Regulation 11 sub-regulation 2
in the‘Regulations for the Act
to provide basic livelihood to all
citizens’or subject to
protection as determined in
section 5 and section 5
subsection 2 in the‘Act to
assist one parent family’
Workers to be assisted by 600,000 won per month per person for the first6 months after
the subsidy to encourage employment, and 300,000 won per month for the next six
new employment other than months
those belong to one of the
above categories.

C. Result
The amount paid as the subsidy to encourage new employment, which was
promulgated in October 2004, was: 800 million Won between October~December
2004, 84 billion won in year 2005, 172.1 billion won in year 2006, 218.7 billion won

in year 2007, and 143.4 billion won in year 2008.

Chapter 5 AID TO CONSTRUCTION WORKERS
1. Purpose of the Aid

Retirement allowance mutual aid for construction workers commenced in year 1998
in order to secure the livelihood of the construction workers. The construction

business owner pays part of the contribution to the aid. The subsidy to stabilize
employment of the construction workers was introduced in February 2004 which
promotes the construction workers’ joining the Employment Insurance.
2. Details of the Program and Payments

A. Aid to the contribution for the retirement allowance mutual aid for
construction workers
The owner of construction work which has voluntarily joined the Retirement
allowance mutual aid for construction workers and pays contributions receive 1/3 of
Appendix
the contributions paid. The subsidy amount paid was: 812 million won for 20,140
workers in 7 construction work places in 2004, 642 million won for 14,762 workers
in 17 construction work places in 2005, 1,437 million won for 14,176 workers in 28
construction work places in 2006, 1,207 million won for 3,636 workers in 34
construction work places in 2007, and 1,101 million won for 1,398 workers in 47
construction work places in 2008.

B. Subsidy to stabilize employment of the construction workers
This subsidy is paid to the construction work owner who employs a manager for
employment works who takes care of the jobs relating to the Employment Insurance
such as the acquisition and loss of the qualification to insure the Employment
Insurance by the construction workers. The subsidy amount ranges from 300,000 to
900,000 won per month depending on the volume of the management work. The
subsidy amount paid was: 4,542 million won to 4,110 construction work places in
year 2005, 14,160 million won to 10,644 construction work places in year 2006,
21,425 million won to 15,758 construction work places in year 2007, and 25,066
million won to 17,957 construction work places in year 2008.
Chapter 6 AID TO CHILDCARE FACILITIES IN WORK PLACES
1. Purpose of the Program

Childcare is no more a personal or family business in this industrialized era because
of the increase of women’s participation in the economic activities. These days
mobilization of woman work force has become a very important element in a nation’s
international competitiveness because of low childbirth rate and high ratio of senior
population. As a result, childcare is now understood as a matter of social and
communal responsibility.
The aid to childcare facilities in work places is prepared to provide easy access of
female workers to childcare facilities. It provides support to the business owners who
establish and operate childcare facilities in the work places owned by his/her
business. It was expected that this program would reduce the burden of childcare
from female workers and, as a result, contribute towards the employment and job
security of the female workers.

2. Childcare Facilities in the Work Places
There are 533 work places that must establish childcare facilities therein (work places
having more than 300 woman workers or more than 500 workers in total). 263 work
places (49.3%) are in compliance of the obligation and 270 work places (50.7%) are

non-compliant. Those complying work places are: 149 work places that have set up the

childcare facility (28.0%); 83 work places paying childcare allowance (15.6%), and 31
work places delegating the childcare responsibility to professional facilities (5.8%).
[Table -6-1] Record of childcare facilities in work places establishment

Work places where childcare facilities are compulsory
Work places
Compliant work places Non-compliant voluntarily
Year Sub-total work places established
Total childcare childcare childcare
complian- facility childcare non-compl-
allowance facilities
ce rate delegated iance rate
established paid

(%) (%)
2006 560 197 112 52 33 363 89

35.2 64.8
2007 535 231 139 58 34 304 149

43.2 56.8
2008 533 263 149 83 31 270 155

49.3 50.7
* Work places where childcare facilities are compulsory have extended to those with 300 female workers or 500
workers in total from 30 January 2006.
* The survey was carried out on private businesses only from December 2007.
Appendix
3. Contents of the Program
A. Subsidy to wages of the childcare teachers and others
The subsidy is paid to the business owner who sets up and operates, alone or together
with other business owner(s), a childcare facility for his/her employees. The facility

must be able to accommodate more than 5 children. Part of the following items is
assisted: wages of the childcare teacher, head of the facility, and the cook. The
800,000 won per month is paid for each childcare teacher on paid employment
working more than 20 days in the month, the head of the facility, and the cook. The
subsidy for the wage of the head of facility is paid only when the facility
accommodates more than 20 children(reduced from 40 children from 1 January
2006). The subsidy for the cook’s wage is only paid to the facilities accommodating
more than 40 children at the end of each quarter.
* History of changes made to this subsidy: (2003) 650,000 won per each childcare teacher per
month => (2004) 700,000 won per each childcare teacher per month (extended to the head of the
childcare facility) => (2005) 800,000 won per each childcare teacher per month => (2006) 800,000
won per each childcare teacher per month (extended to the cook)
B. Loan or subsidy of the costs to establish childcare facilities in work

places
The program gives loan or subsidy to the business owners the costs to establish
childcare facilities their work places. The loan is up to 500 million won with interest
rate of 1% (2% for big corporations) per annum and may be used to pay the costs of
construction, purchase, lease, upgrade, and repairing of the childcare facility. The
loan may be repaid by equal installments over 5 years period starting after 5 years of
grace period.
Further, free aid is given to cover the expenses relating to conversion of the facility
and to consumables such as tools and furniture. The aid amount is up to 100 million
(200 million for organizations) won for conversion of the facility and 50 million won
for tools and equipments.
The Korea Workers’ Compensation and Welfare Service takes care of the aid to
establishment of childcare facilities in work places. Accordingly, the business owner
who wishes to receive the loan or the free aid should submit an application to the
branch manager of the Korea Workers’ Compensation and Welfare Service.

4. Result and Evaluation
The subsidy for wages of the childcare teachers and others was paid to 636 facilities
in the sum of 12,610 million won. The loan was given to 2 work places that had

established new childcare facilities in the sum of 300 million won. The aid for
conversion of facilities and purchase of tools and furniture was paid to 27 work places

in the sum of 3,229 million Won.
It is expected that more endeavors will be made to expand the childcare facilities in
the work places in the future as social interest on the woman workers°Ø participation
to the economic activities increases and the policies and the programs to expand their
employment opportunities keep being made.
[Table -6-2] Annual payments of the Subsidy to wages of the childcare

teachers and others
(unit: million won)
Distinction 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008
Number of work places 317 357 340 322 345 401 449 537 607 636
Total number of beneficiaries 2,862 3,496 1,528 1,511 1,700 2,262 2,863 3,854 4,918 5,976
Amount paid 2,029 2,483 2,403 2,483 2,918 4,128 5,952 8,106 10,429 12,610
[Table -6-3] Yearly record of the loan for establishing the childcare facilities in
the work places
Appendix
(unit: million won)
Distinction 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008
Number of
2 2 2 2 3 1 9 4 9 2
Loan work places
Amount paid 540 98 125 450 811 150 2,657 511 2,700 300

[Table -6-4] Yearly payments of the free aid to establish the childcare
facilities in the work place
(unit: million won)
Distinction 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008
Number of
- 2 1 - 16 22 20 33 21 27
Loan work places
Amount paid - 136 94 - 1,120 1,221 1,393 3,245 2,675 3,229
Chapter 7 IMPROVEMENTS MADE TO THE JOB SECURITY

PLANS IN 2008
1. Restructuring the Job Security Plan

Such programs as the Subsidy to encourage re-employment, the Subsidy to promote
SMEs entering into new business areas, and the Subsidy to encourage employment of
middle and upper middle aged people who have completed job training were
abolished because those programs were evaluated as not being effective by the
Employment Insurance Regulations and the regulations were changed in September
2008. The subsidy to improve employment environments of the SMEs was
restructured. The subsidy to improve work environment was abolished from April
2008 upon the analysis that it might be overlapping with other programs. The aid to
welfare institutions was increased.
2. Improving the Subsidy to Encourage new Employment Plan

There has been criticism of the appropriateness of the beneficiaries and the problem
of loss in the hands of the business owners was raised. Responding to such concerns,
changes have been made. The beneficiaries of the assistance for the jobless youths

and the woman household heads are narrowed from January 2009 to those belong to
the vulnerable by amending the Employment Insurance Regulations in September
2008. It was hoped that the changes would expand the roles of the Job Stabilization
Institutions as major players in promoting employment of the vulnerable group.

Further, farmers and fishers who are closing their businesses were included in the

plan as a preparation for the entering into and ratifying of the Korea-US Free Trading
Agreement.
363,000 applications made for the subsidy to encourage new employment in year
2007 as the application was to be submitted quarterly. The enormity of the number of
applications caused problems such as wrongful receipts and administrative burden.
The frequency of the application was changed to a half year basis, effective from
January 2009 by changing the Rules in April 2008.

3. Increasing Amount of Subsidy to Encourage Job Change Training.
The amount of the subsidy to the SME owners who provide job change training to
their employees was increased to 100% from 3/4 of the costs of such training. The
change was made because there were not many applications for the subsidy by SME
owners despite high level of assistance. It was analyzed such trainings were more
burdensome to SMEs. The change was made to reduce the burden on the SME
owners. The subsidy to big corporations stayed the same, being 2/3 of the costs.
4. Increasing Amount of Subsidy to Encourage SMEs to Improve

Appendix
Working Environment.
The upper limit of the subsidy for the investment made to improve working
conditions by the SMEs was increased to 50 million won from 30 million won. The
increase was made to encourage improvements on poor working conditions of SMEs,
and to build grounds to create work places in SMEs.

5. Increasing Amount of Subsidy to Encourage Re-Employing
Female Workers After Their Pregnancy & Giving Childbirth
A. Subsidy to encourage the employment of female workers after their pregnancy
and giving childbirth.
The subsidy to encourage the employment of female workers after their pregnancy
and giving childbirth is paid to the business owners who sign labor contracts for the
term exceeding 1 year with those female workers who are employed as non-regular
workers and their employment terms end when they are pregnant or on childbirth
(miscarriage, dead birth) leave. The new labor contract must be renewed immediately
after completion of the workers’ leaves. The plan was changed in April 2008 in order
to encourage change of the female workers’ employments to regular ones. As a result
of the change, the subsidy payment period was extended to 1 year to those employers
who did not fix the term of the woman employer. The payment amount was increased
to 600,000 won for the first 6 months and 300,000 won for the next 6 months.
[ Details of the improvements on the plan ]

Distinction Before After Time of change
Female workers in Female workers in

pregnancy of 34 weeks or pregnancy of 16 weeks or
more more
Beneficiary 2007.4.27
Subsidy shall not be paid Employment on repetitive
when the employment is on contract for 1 year term
repetitive contract for 1 year also receive the aid
term
Fixed term employment- Fixed term employment -
400,000 Won per month for 400,000 Won per month for
6 months 6 months
Payment Employment of indefinite Employment of indefinite 2008.4.30
amount term-600,000 Won per term-600,000 Won per
month for 6 months month for first 6 months,
and 300,000 Won for the
next 6 months

[Table -7-1] Annual result
(unit: million won)
Distinction Work Number of Paid Payment amount for each beneficiary

places beneficiary amount

400,000 ~ 600,000 Won per month
2006 16(8) 17(9) 13
for 6 months

2007 271(58) 291(66) 174 same as above
Fixed term employment-400,000

Won per month for 6 months
2008 450(99) 621(143) 383 Employment of indefinite term-
600,000 Won per month for the first
6 months, and 300,000 Won for the
next 6 months
B. Subsidy to encourage new employment of returning female workers

after childbirth (Subsidy to encourage employing mothers)
The subsidy to encourage new employment of female workers retuning to work after
giving birth to children (subsidy to encourage employing mothers) was paid to the
business owners who employ female workers who quit the job because of pregnancy,
childbirth, and childcare. Then a change was made to make the subsidy more active.
The requirement that the new employment must be‘within 5 years since quitting her
job’was removed so that more people could be benefitted.
[Table -7-2] Annual execution record

Appendix
(unit: million won)
Distinction Work Number of Paid Payment amount for each beneficiary

places beneficiary amount
2007 78(25) 78(25) 45 600,000 Won per month for the first
6 months, and 300,000 Won for the
2008 338(61) 369(61) 182 next 6 months (1 year in total)

6. Other Improvements to the Plan
Work places with less than 20 workers are qualified to receive the subsidy for
reduction of working hours because the law setting 40 working hours per week as the
standard had come to apply to work places with 20 or more workers. The payment
limit of this subsidy for each work place was increased (10% => 30%) from January
2009 so that more poor SMEs could adopt the 40 working hours per week plan early.
The Employment Insurance Regulations were amended to lay the foundation for the
SMEs to voluntarily carry out programs that may improve their employment structure
to improve the working conditions of non-regular workers at SMEs. The programs
included consultation to improve human resources management, constructing
programs that will improve job capabilities of the non-regular worker, re-architecting
wages and responsibilities, and improving the organizational culture. The job of
implementing the plan was delegated to the Korea Labor Institute.

SECTION
JOB CAPABILITY DEVELOPMENT
PROGRAMS

Chapter 1 OVERVIEW
1. Background and Purposes
The ability to create, share, and utilize knowledge and information is now recognized
as the source of competitiveness. The transition into a society of knowledge-based
economy caused structural change in the labor market in regard to the structure of

demand and supply of labor, and the employment practice. The concept of‘an
occupation of lifetime’substituted the concept of‘a work place for lifetime’
. The
practice of long term employment of the members of a corporation was replaced by
‘employability based on the flexibility of the labor market.’Further, as the structure
of production organization based on bureaucracy and division of is replaced by
horizontal and comprehensive organization structure, the development of intellectual
capabilities of members of the organization is required.
The job capability development programs (the‘JCDP’) are designed to assist the
businesses and the workers to meet such challenge and endeavor to develop the workers’
Appendix
job capabilities. The programs also include assisting re-employment of job changers or
unemployed people following restructuring, and enhancing the move of labor.
The Occupational Training Act enacted in 1967 introduced government-aided job

training into this country. The Principal Act on Occupational Training, introducing
the Obligatory Training Plan which put the liability of training the workers onto their

employers, was enacted and promulgated in 1976. The Act established the frame of
job training. The 1976 Act set the production of skilled laborer required in the
industrial society as its goal. The Act had contributed very much to the economic
development of the country by training youths who could not go to higher level
schools because of financial hardship to become good quality craftsmen and
supplying them to the key industries of the country. The Act also had extended the job
training opportunities to the disabled, housewives, the aged, and the unemployed who
were disadvantaged in the labor market.
Now, as the world has entered into the era of information technology and global
market economy, corporations in many countries are paying attention to the
technological innovation and improving‘quality of labor’. Improving the‘quality of
labor’is emboldened as the country’
s core task as it may increase not only the
competitiveness of the corporations but also the quality of the workers’lives.
Korea has been following the economic development strategy based on the low wage
level and the‘quantity of labor’rather than the‘quality of labor’in the past.
However, upon entering into the era where“technological innovation takes the
priority,”the need to produce, develop, and manage skilled worker who will lead the
trend emerged as the essential task of the country. Further, it was necessary to
promote“high quality technological innovation”led by scientists and engineers to
take the economy one level higher.
JCDP were introduced to meet such challenge through new legislation of the
Employment Insurance Act in July 1995. The focus of job training has moved from
producing skilled laborers to lifetime development of the workers’job capabilities.
On the other hand, it became necessary to unify the JCDP and the Obligatory
Training Plan that were separately operated since 1995. A new frame of job training
to develop and upgrade job capabilities of the workers was also required. In order to

meet such needs, the Principal Act on Occupational Training 1976 was repealed and
the Act to Promote Workers’Occupational Training was enacted on 24 December
1997 and came into effect from January 1999. The Act to Promote Workers’
Occupational Training changed its name into the Employee Skills Development Act

on 31 December 2004.

2. Laws and Regulations Related to JCDP
The related Acts are roughly the“Employee Skills Development Act”

,“Employment
,“National Qualification of Skills Act”
Insurance Act” ,“Act to Promote Skilled
,“Act to Establish and Operate the Human Resources Development Service of
Labor”
, and the“Technical College Act”.
Korea”
Important changes made to the Act are as shown in <Table -1-1> below:

[Table -1-1] Laws and regulations related to job capability development programs
Acts Contents of the acts
Employee skills Defines and regulates general matters related to Job Capability
development act Development Training-Training facilities, training course recognition,
(enacted 24. Dec. 1997, training course evaluation etc.
amended 31.Dec.2008)
Employment Insurance Defines and regulates matters related to assisting JCDP with the
act (enacted 27 Dec. Employment Insurance Fund-numerous programs such as Business
1993, amended 31. owner training, Staff training, training of the unemployed , etc.
Dec. 2008)
Appendix
National qualification Regulations on the management and operation of the national

of skills act (enacted qualifications on skills-Setting up a system to educate and train the
31 Dec.1974, amended people who had acquired the national qualifications on skills, providing
27. Apr. 2007) legal ground to assist the testing institutions, tiding up the procedure to
cancel the delegation of the training to private institutions, providing
the legal ground to punish those who lend the qualification certificates

Acts Contents of the acts
Act to promote skilled Encourage skills and improve social, economic status of the skilled
labor (enacted 1 Apr. workers-appointing the master craftsman, skills competition, skills
1989, amended 30 Dec. Olympic, world skills competition, and provision of inducements to
2005) skilled technicians etc
Act to establish and The law establishing the human resources development service of
operate the human Korea
resources development - major functions of the institution: assisting trainings, carrying out
service of Korea tests for qualifications, encouraging skills
(enacted 31 Dec. 1981, - rules related to officers, board of directors, guiding and regulating
amended 31 Dec. 2008) business of the institution
Technical college act The law establishing technical colleges

(enacted 23 Jul.1977, - operating a program for multi-skilled technicians, defining the
amended 29 Aug. 2008) qualifications and appointment of the teachers and instructors,
awarding academic degrees
Chapter 2 AID TO THE JCDP BY THE BUSINESS OWNERS
1. Aid to the Job Capability Development Training “JCDT”

( )
A. Subsidy for training costs
Subsidy is paid to the business owners who provide job training to the employees for
the purpose of improving the employees’ job capabilities. The training may be carried
out by the business owner or delegated to such institutions as the Corporate Training
Center and other delegated training centers (public job training center, designated job
training center, incorporated companies providing job capability development
trainings, private education centers, college or universities, institutions providing
lifetime education). The course must be recognized by the government as a JCDT.

[ Subsidies when attending trainings provided by outside institutions ]
Training Costs
- When attending a training courses for priority occupation as noticed by the
Minister of Labor

Standard costs determined according to the occupation × modification number ×

hours of training× number of workers completing the training × 100%
- Other training courses
Standard costs determined according to the occupation × modification number ×
hours of training × number of workers completing the training × 80% (100%
for prior assistance corporations)
- However, if the actual amount the business owner had paid to the delegated
training institutions is less than the amount as calculated above, then the amount
actually paid only shall be subsidized to the business owner.

Training allowance
- The allowance is paid to the business owner who provides training to the job
seekers or potential worker and pays allowances to the trainees, the total sum of
the allowance the business owner had paid to the trainees is reimbursed up to
200,000 Won per person per month.
Allowance for food and accommodation

- When the institution providing the training also provides accommodation to the
trainees, the costs of accommodation(including the costs of meals) are
Appendix
reimbursed up to 8,500 won per person per day. (If the course lasts longer than 1
month, and provides training for more than 5 weeks and accommodates the
trainee during weekends and public holidays, the sum of reimbursement is up to
212,500 Won per person per month). When food is provided to the trainees
attending to a course with classes longer than 5 hours per day, food allowances
up to 3,000 won per person per day is paid.

[ Subsidies provided when attending on-site training ]
When the business owner carries out on-site training for the trainees (workers
currently employed, workers soon to be employed, job seekers, and engineering high
school graduates or soon to graduates) who have completed either training courses of
outside institution’s or courses provided by remote access training, the costs of the
on-site training is reimbursed as calculated by the following formula:
- Standard unit costs set according to the occupation for which the training was
given x modification number × hours of training (up to 1,400 hours) × number of
workers completing the training × 40%
[ Subsidies provided for remote access training ]
When the training is provided via mail, 80/100(100/100 for the assistance priority
corporation) of actual training costs spent for the trainee who has completed the
course shall be subsidized. The ceiling of the subsidy per month per each trainee is set
in accordance with the evaluated grade of the training institution as shown below in
<Table -2-1>:
[Table -2-1] Monthly ceiling of the subsidy for postal remote access training
(unit: won)
Grade of training institution A grade B grade C grade
Cost of training (won) 36,000 30,000 24,000
As for in-house training or delegated training using internet or other information

technology, 80/100 (100/100 for the assistance priority corporation) of actual training
costs spent for a trainee who has completed the course shall be subsidized, provided
that the ceiling of the subsidy per month per each trainee is determined according to
the evaluated grade of the institution, the grade of the contents, and hours of the
training.

The subsidy for JCDT was paid to 3,654,216 people in the sum of 382.581 million
won in 2008, showing increase of 354,019 people and 41,657 million won from the
previous year. The details are as shown below in <Table -2-2> below:

[Table -2-2] Subsidy paid for job capability development training

(unit: million won)
Distinction 2004 2005 2006 2007 2008
Number of recipients 1,958,130 2,350,509 2,752,052 3,300,197 3,654,216
Amount paid 198,243 236,495 296,864 340,924 382,581
B. Subsidy for paid training leave

Recipients
- The subsidy is paid to the business owner who gives his/her employee of more than
1 year of(any employee working for businesses with less than 150 regular
employees or the corporates to receive prior assistance) paid leave so that the
employee could attend job training, and pays the wage, which is the same as or
more than ordinary wage, and the cost the employee needs to attend the training.
Training
- The training course must be no less than 120 hours and the paid leave period must
be no less than 120 hours(in case of businesses with less than 150 regular
Appendix
employees or corporations to receive prior assistance, no less than 7 days of leave

and no less than 30 hours of training course).
- However, when the business owner is a worker in the manufacturing industry or
related occupation and noticed by the Minister of Labor, courses of less than 20
hours of training are also included.

Amount of subsidy
- Wage: the minimum wage per person per month as calculated in accordance with
the Minimum Wage Act (150/100 in case of the corporations to receive prior
assistance)
- Cost of training: the same amount as that of the subsidy paid when the training for
current employees is delegated to external institutions
Bigger businesses are increasingly participating to the paid leave training than SMEs
as shown below in <Table -2-3>. However, more and more SMEs are taking part in
the program as a result of persistent efforts to raise awareness. The gap between big
corporations and SMEs in participating the program is getting smaller.
The number of recipients at work places with less than 300 employees in 2008 was
3,33, showing 116.1% increase from the previous year. The ratio of SMEs among the
total recipients had also increased by 21.6% from the previous year, making 35.7%.
[Table -2-3] Ratio of work places classified by their size

(unit: million won)
Number of trained employees

Year Amount paid From work places From large work
Total with less than 300 places with more
employees than 300 employees
5,941 530 5,411
2006 10,419
(100.0) (8.9) (91.1)
7,133 1,541 5,592
2007 13,823
(100.0) (21.6) (78.4)
9,324 3,330 5,994
2008 15,071
(100.0) (35.7) (64.3)
* Figures in ( ) shows the ratio.
C. Ceiling of the subsidy for JCDT and other training
The business owner can receive up to 100% of the individually calculated insurance
premium for Job Security Plan and JCDP he/she has to pay in the relevant year (240%
for the priority corporations).

When the business owner provides training to the workers employed by other than
his/her own business, additional subsidy of up to 80% can be paid.
When the subsidy amount is less than the minimum subsidy amount set by the Minister
of Labor, taking into account of the size of the business and the nature of the industry,

the subsidy amount is the minimum subsidy amount (currently 5 million Won).

2. Loan for Training Facilities and Equipments
This loan is for business owners, business owners’ organization, workers’

organization, training corporations and institutions when they set up job training
centers or purchase training equipments.
The loan amount is up to either 6 billion won or 90% of the cost required, whichever

is smaller.
Interest rate
- 1% per annum for priority corporations, business owners’ organizations, big
corporations participating SME training consortium
- 2% per annum for Big corporations
- 4% per annum for workers’ organizations, training corporations and institutions
Term
- Up to 10 years (repayment by installment in 5 years after 5 years of grace period) Appendix
[Table -2-4] Record of the loan

(unit: million won)
Year 2003 2004 2005 2006 2007 2008
Number of work places 4 3 7 7 9 10
Loan amount 3,671 6,250 9,832 8,000 7,600 8,360

3. Assistance to In-House Qualification Program
Purpose
Developing the workers’ job capabilities and promoting the business’s technologies
by subsidizing the cost required to operate in-house qualification program
Recipient
Business owners who develop and operate qualifications appropriate to the character
of the business for his/her employee.
Requirments;
- the qualification should be recognized by the Human Resources Development
Service of Korea
- the test for qualification must be carried out by the business owner alone or
together with others on the workers in his/her business or other related business
- the qualification subject must be directly related to the knowledge and skills
required for the business
- the business must prepare and undertake the rules that offer the workers who
acquired the qualification the advantage in promotion and remuneration
- the test is not for commercial gain
Subsidy amount
Costs of developing the test: up to 12 million Won (15 million Won for the priority
corporations) per annum within 1/2 of the costs of developing tests for each subject
Costs of operating the test: up to 10 million Won (12 million Won for the priority
corporations) per annum within 1/2 of the costs of developing tests for each subject,
for 3 years among 4 years including the payment year (no limit on the payment period
for the priority corporations)
[Table -2-5] Payment record

(unit: million won)
Year 2002 2003 2004 2005 2006 2007 2008
Subjects 35 38 29 27 19 28 29
Amount paid 172 254 251 248 115 270 323

Chapter 3 AID TO SMALL AND MEDIUM SIZE ENTERPRISES
1. Small and Medium Size Enterprise “SME”

( ) Job Training

Consortium Program

“Economic Development Strategy based on Knowledge”(Department of Finance &
Economy and Department of Labor, April. 2004) and“3 Year Plan for Job Capability
Development”(Dec. 2000) were prepared as a plan to raise high quality human
resources in order to resolve the problem of labor force shortage of SMEs. The
government picked a model“Training Consortium”in 2006 in accordance with the
guideline shown in those aforementioned strategic plans. SME Job training program
provides subsidy for the cost of building infrastructure and the cost of trainings by the
consortium comprised of SMEs and those institutions that are equipped with good

quality infrastructures such as facilities, equipments, and programs required to carry
out high quality job training. Those institutions include big corporations, business
owners’ organizations, and colleges and universities.
Contents of aid
- costs of facilities and equipments: Up to 100% of the insurance premium paid for
Job security & JCDP(up to 240% of the insurance premium paid by the
participating SMEs for business owners’ organizations, public institutions, and
Universities) with the ceiling of 1.5 billion won per annum
- operation costs and cost of labor required for the operation of the program
Appendix
- training costs: 100% of training costs set in accordance with the category of the
occupation by the regulations on payment of subsidy for JCDP.
The following changes were made to the program in 2008:

- The Human Resources Service of Korea took over the programs from the head
quarter and branches of the Ministry of Labor. It was expected that this change of
governing body would make the program more effective.

- Appointed a number of universities as the central university of its region in the
JCDP and encouraged those universities to sign agreements with big corporations
and business owners’ organizations so as to secure the participants in the JCDTs
whom the universities will provide.
The program was expanded by appointing 14 new organizations were appointed as

the operators of the SME consortium, and 281,000 workers belonging to 112,000
SMEs took part in trainings provided under the JCDP in year 2008.
[Table -3-1] Record of Training by SME Consortium

(unit: million won)
Year 2001 2002 2003 2004 2005 2006 2007 2008
Operating institutions 6 8 19 30 47 57 69 83
Trained workers
4 10 20 38 71 143 295 281
(,000 people)
Participating SMEs
1 3 8 15 33 63 134 122
(,000 businesses)
Aid amount
32 61 141 168 399 450 744 702
(100 million Won)
2. Assisting Study Groups in SMEs
This program assists SMEs and Priority Corporations organizing study groups in
order to their workers’ job capabilities. The technique, consulting, and costs required
for the study group are assisted.
Recipients
SMEs and Priority Corporations selected by the Minister of Labor(or the Human
Resources Service of Korea)

Contents of assistance
- costs related to organizing study groups
- cost of the equipments, developing programs, consultation, and remunerations of
the people managing the groups.

Period of assistance: 1 year in principle, but may be extended up to 3 years.

[Table -3-2] Aid payment record
(unit: million won)
Year 2006 2007 2008
Recipient work places 112 243 263
Amount paid 6,092 9,543 7,860
* The program commenced in 2006.
3. Assisting SMEs Trainings to Improve Core Job Capabilities

This program provide the opportunities to the owners and employees of SMEs and
Priority Corporations to receive the best quality trainings provided by prominent
training institutions free of charge, which they could not attend before because of
high costs of the programs.
Recipients:
Owners and employees of the Priority Corporations selected by the Minister of Labor
through the HRSK.
Contents of the assistance

- Wages of the workers (training hours × minimum wage × 2), training costs
Appendix
(actual costs, up to 20,000 Won), etc

(unit: million won)
Year 2006 2007 2008
Recipient work places 19,176 21,795 25,945
Amount paid 14,381 16,606 15,989
* The program commenced in year 2006.

Chapter 4 ASSISTANCE TO THE EMPLOYED WORKERS
1. Allowance for Education Fee
Recipients
- The following people may apply for and receive allowances under this program:
�Who belong to one of the following categories: Insured people of the EI who are
about to leave job involuntarily during training or within 1 month from
completion of training, insured people of the EI of 40 years of age or older,
workers currently employed to businesses having less than 300 regular
employees, fixed term employees, short term workers, daily workers, deployed
workers, and self- employed people who have joined the EI (However, every
currently employed worker who is insured by the EI are qualified for the basic
course on information technology);
�Who has completed a course recognized as a JCDT course (however, the basic
course on information technology is limited to those notified by the Minister of
Labor);
�Who has attended more than 80/100 of class hours of the course;
�Who has paid the education fee out of his/her pocket.
Amount of the allowance

- The allowance has a ceiling of 1 million won per annum. Actual payment amounts
are set as follows:
�80% of the course fee for general courses (up to 100% of the standard training
costs),
�50% of the course fee for foreign language course (up to 40 hours and 90,000
won per month),

�100% of the course fee for basic information training (up to 90,000 won for
basic course 1 and up 120,000 won for basic course 2 per month).
Non-regular workers receive the allowance up to 100% for job training course, and

80% for foreign language training.
The payments under this program was 53,506 million won to 287,827 people in 2008,

showing increase of 724 million won and 18,782 people from the previous year.
[Table -4-1] Allowances paid for workers’education fees (unit: million won)
Year 2002 2003 2004 2005 2006 2007 2008

Recipients 35,537 29,177 38,908 70,732 155,620 269,045 287,827
Amount paid 3,435 4,224 5,873 11,688 28,851 52,782 53,506

2. Student Loan for Workers
Recipients
- Workers, who are insured to the EI, enter or are attending educational institutions
higher than the Technical College as defined by the Technical College Act or
Polytechnics established under the High Education Act or the Education for Life
Act.However, workers who receive full amount of the school fee as scholarship,
subsidy, or loan are not eligible for the loan.
Amount and number of the loan

Appendix
- The loan amount is up to full amount of the school fee. However, if the worker
receives assistance with the registration costs such as scholarship, the loan amount
shall be school fee after deducting the aid amount.
* School fee means all costs necessary to register to the school including tuition, course fee, and
PTA membership fee.

Terms of Loan
Interest: 1% per annum (loan on credit) 1.5% (general loan)
Repayment:
Interest: Payable to relevant financial institutions 4 times a year by the end of each
quarter
Principal: By quarterly equal installments over 2 years period (technical college and
polytechnics) or over 4 years (Universities)
Total amount of the loan in year 2008 was 87,754 million Won, increasing by 7,903
million Won from the previous year as shown in <Table -4-2> below:
[Table -4-2] Amount of student loan given to workers

(unit: ,000 people)
Types of confirmed recipients

Average
Loan Confirmed loan Study area Corporation Sex School type
Year amount
amount recipients per Science
Priority Big 2 year 4 year
and Other Male Female Other
person Corp. Corp. course course
technology
24,443 12,182 12,261 14,878 9,565 14,234 10,209 15,321 9,122
2002 52,186,786 2,135
(100) (49.8) (50.2) (60.8) (39.1) (58.2) (41.8) (62.6) (37.4)
27,772 11,970 15,802 16,234 11,538 15,503 12,269 11,791 15,981
2003 63,475,661 2,286
(100) (43.1) (56.9) (58.5) (41.5) (55.8) (44.2) (55.2) (44.8)
30,978 11,798 19,180 18,242 12,736 17,059 13,919 12,070 18,908
2004 74,798,812 2,415
(100) (38.1) (61.9) (58.9) (41.1) (55.1) (44.9) (39.0) (61.0)
29,149 10,622 18,527 11,620 17,529 16,158 12,991 10,366 8,419 10,364
2005 76,504,816 2,675
(100.0) (36.4) (63.6) (39.9) (60.1) (55.4) (44.6) (35.6) (28.9) (35.5)
28,342 10,372 17,970 16,845 11,497 15,668 12,674 8,971 19,371
2006 81,641,937 2,881 -
(100.0) (36.6) (63.4) (59.4) (40.6) (55.3) (44.7) (31.7) (68.3)
9,013 16,212 14,686 10,539 13,924 11,301 19,276 5,946 3
2007 79,850,780 25,225 3,166
(35.7) (64.3) (58.2) (41.8) (55.2) (44.8) (76.4) (23.6) (0.0)
9,715 15,793 14,683 10,825 14,378 11,130 19,707 5,797 4
2008 87,754,100 25,508 3,440
(38.1) (61.9) (57.6) (42.4) (56.4) (43.6) (77.3) (22.7) (0.0)
* Note: Numbers in ( ) represents ratio in percentage (%).

3. Loan for Training Fee
�This program provides loan to workers. The fee for trainings necessary for Job
Capability Development is being offered.
�Recipients: Employed workers who are insured to the EI.

�Terms of Loan

- Loan amount: All of the course fee of the JCDT (up to 3 million Won per annum)
- Interest: 1.5% per annum
- Repayment: By quarterly repayment in 1 year after 1 year of grace period.
4. Subsidy for Qualification Test Fee

When a worker, who is insured to the EI, obtains 2 or more national qualifications,
the costs of the tests for the qualifications are subsidized.

Recipients: A worker, insured to the EI, who has acquired 2 or more skill
qualifications recognized in the National Skills Qualification Regulations.
Contents of the subsidy

- All of the test fee, costs of purchasing text books and attending the training course
(100,000 Won)
- Assistance may be given up to a couple of times if the worker acquires 2 or more
national skill qualifications

(unit: million won)
Appendix
Year 2003 2004 2005 2006 2007 2008

Recipients 2,637 4,337 6,689 34,423 36,523 15,850
Amount paid 298 488 717 4,634 5,108 2,209
* This subsidy is now abolished upon amendment to the EI Regulations on 29 April 2008. (However,
people who obtained 2 qualifications by 29 April 2008 shall receive the subsidy until 29 April 2011.)

Chapter 5 AID TO THE TRAINING OF THE UNEMPLOYED
1. Training of Unemployed People Who are Changing Jobs
This program provides the people who were dismissed from work where the EI applies
with the opportunities to take part in the training to acquire skills and knowledge
useful to get another job. It is hoped that this program will improve the quality of
workers’ lives by promoting re-employment and by stabilizing his/her livelihood.
Trainees
- An employee, used to be insured to EI, registered to the Job Center to get a job and
wants to receive job training.
Training Institutions
- Job Capability Development Training facilities as defined in section 2 in the
Worker’s Job Capability Development Act, Schools as defined in the High
Education Act, and other facilities acknowledged by the head of local labor office.
Training Course
- Job Capability Development Training Courses developed to learn and improve work
performance of the workers that will contribute towards the trainee’s job
opportunities, either for starting his/her own business or getting employed.The
following courses are excluded:Information exchange courses such as seminars or
symposiums, or general educations on current affairs or common knowledge; Normal
degree courses provided by tertiary educational institutions above college level
established under the High Education Act; Courses to attend examinations to be a
Lawyer, Patent Attorney, Certified Public Labor Attorney, and public servants;Courses
for occupations that may cause offence to the Public Health Act; and Other courses
that the head of local labor office regards inappropriate for job capability training.
Day courses in principle, but night courses are allowed if necessary considering the
region and the character of the training.

The course must be for more than 60 hours in total during the time period between 1
months and 1 year. Initial course presented in accordance with rule 18 sub-rule 2 in
the Rules of the Job Training for Unemployed and on-site training at the social
welfare facilities are recognized as the training hours.

Contents of assistance
- Training costs: Standard unit costs as set down in the Rules on the payment of the

subsidy for JCDP × modifying figure × training hours during the period ×
average of the number of attending trainees
- Training allowances: expenses on travel and food
The subsidy for training for the job changing of the unemployed in 2008 was paid to
70,556 people in the sum of 160,899 million Won, showing increase of 8,295 million
Won (5.4%) from the previous year.
[Table -5-1] Subsidy for training for the job changing of the unemployed

(unit: million won)
Year 2005 2006 2007 2008

Recipients 64,179 53,622 65,242 70,565
Amount paid 136,788 128,486 152,604 160,899
The number of participants sorted by areas of the training in 2008 was in following
order; service 22.0%, administration and management 19.6%, machines and
equipments 17.5%, information and communication 17.1%.
[Table -5-2] Number of trainees sorted by the work areas

(unit: %)
machines and electrics and information and industrial admin and

Year Total service other
Appendix
equipments electronics communication application manage
2004 100 14.0 6.0 26.6 5.7 24.2 10.2 13.3

2005 100 15.8 6.8 24.1 6.3 22.0 12.0 13.0
2006 100 14.6 5.4 22.2 6.8 22.7 15.1 13.2
2007 100 15.0 4.8 22.2 6.2 21.4 18.0 12.4
2008 100 17.5 4.8 17.1 5.5 22.0 19.6 13.5
* Training for woman household heads is excluded.

2. Training for Priority Occupational Areas
Purpose
- It is expected that this program will:
improve national competitiveness by raising skilled workers required for key
industries and strategic industries of the country;
improve employment opportunities and job security of teenagers who do not
proceed to higher education and the unemployed by providing them with the
opportunities to receive JCDT.
Beneficiaries of the training

- The people who can participate in this training assistance program are:
Unemployed person of 15 years or older who has registered to the Job Center to
find a job;
Students in the third grade in the junior high school who are not planning to
proceed to higher education
Training institutions
- Private training institutions (training corporations, training facilities), and the
Human Resources Development Offices of the Korea Chamber of Commerce and
Industry
Occupational areas trained for and the training period

- 83 occupational areas, as of year 2007, are nominated as the priority areas including
Engineering design and production, mechatronics, information and communications
equipment, welding, interior design, machines and equipment, etc.
Training period: 6 months ~ 1 year (2 years for the Korea Chamber of Commerce
and Industry)
Cost of training
- Training fee, as calculated using the following formula: Standard unit training costs
set for each industry × modifying figure × training hours × number of trainees
completing the course

Dormitory fee: 8,500 Won per day if the training period and unit month is less than
1 month, and 212,500 Won per month when the training period is 1 month or longer
Training allowance: allowances for travel (50,000 Won per month), allowance for
food (paid only when the course lasts 5 hours or more in a day, and 100 hours and

more per month), and allowance for the priority industrial area (high school

students receives allowance to encourage skills in the sum of 100,000 won)
Participants of the training for priority occupational areas are increasing every year.
The allowance was paid to 22,126 people the sum of 125,487 million won.
[Table -5-3] Assistance to the training for priority occupational areas

(unit: million won)
Year 2004 2005 2006 2007 2008

Number of
16,014 14,743 21,557 27,072 22,126
participants

Amount paid 89,992 83,081 134,614 149,310 125,487
Chapter 6 PERFORMANCE RECORD OF THE JCDP
1. Overview
The result of the JCDP is shown in <Table Ⅱ-6-1> below. The Table shows that the
Appendix
followng increases have been made since 2007; work places 12.9%, the insured
people received the assistance 10.4%, the amount paid 9.4%. The increases in number
of trainees in the respective programs in the same period are; JCDP 10.7%, Student
loan for workers 1.1%, paid leave training 30.7%.

[Table -6-1] Result of the JCDP
(unit: million people)
Assisted work places Increase Assisted people Increase Subsidy paid Increase
Distinction
2007 2008 (%) 2007 2008 (%) 2007 2008 (%)
Total 188,653 213,061 12.9 3,666,842 4,047,439 10.4 639,984 699,814 9.4
JCDP 187,663 210,738 12.3 3,300,197 3,654,216 10.7 340,924 382,581 12.2
Training on
990 2,323 134.7 7,133 9,324 30.7 13,823 15,071 9.0
paid leave
Course fee
269,045 287,827 7.0 52,782 53,508 1.4
Subsidy
Student loan
25,225 25,507 1.1 79,851 87,755 9.9
for workers
Training for job
changing of the 65,242 70,565 8.2 152,604 160,899 5.4
unemployed
2. Assistance to JCDP
The JCDP was carried out for 1,424,330 work places, 9,385,239 people.
[Table -6-2] JCDP Performance according to the work place size
Subsidy Trained people

Year Total
amount Total Less than 500 500~ less than 1,000 1,000 or more
2,752,052 442,911 599,733 1,709,408
2006 153,238 296,864,156
(100.0) (16.1) (21.8) (62.1)
3,300,197 635,445 809,367 1,855,385
2007 187,663 340,924,472
(100.0) (19.3) (24.5) (56.2)
4,006,649 1,124,547 964,362 1,917,740
2008 119,910 474,119,156
(100.0) (28.1) (24.1) (47.9)
Note: 1. Numbers inside ( ) shows ratio in percentage (%).

2. Such programs as Aid for JCDTs by business owners (including paid leave training), course fee
allowance, workers capability development card program, and SME core job capability
development are included.

The performance record of JCDT sorted in accordance with the size of work places
are as shown below in <Table Ⅱ-6-3>. Payment and receipt ratio, meaning the
portion of the amount received as subsidies for training compared to the amount paid
for the Employment Insurance premium, of the work places with 1,000 or more

employees was 32.3%, lower than the average payment and receipt ratio of 33.8%.

The payment and receipt ratio of the business owners with less than 50 employees
was 38.2%.
[Table -6-3] Performance record of the assistance to the employee training

sorted according to the size of the work place
(unit: million people)
Less than 50~300 300~500 500~1,000 More

Distinction Total Unknown

50 people people people people than 1,000
1,424,330 1,388,974 30,977 2,142 1,427 810
work places 0.0
(100.0) (97.5) (2.2) (0.2) (0.1) (0.1)
Employment 9,385,239 4,708,422 2,162,761 439,977 547,009 1,527,070
insured people 0.0
Insurance (100.0) (50.2) (23.0) (4.7) (5.8) (16.3)
1,401,325 310,347 273,518 92,116 135,310 590,033
paid premium 0.0
(100.0) (22.1) (19.5) (6.6) (9.7) (42.1)
119,910 92,082 21,508 2,243 1,907 1,981 189
work places
(100.0) (76.79) (17.94) (1.87) (1.59) (1.65) (0.16)
Performance assisted insured 4,006,649 688,772 825,904 242,507 331,726 1,910,611 7,129
record people (100.0) (17.19) (20.61) (6.05) (8.28) (47.69) (0.18)
474,119 118,705 88,051 25,476 33,012 190,572 18,304
paid premium
Appendix
(100.0) (25.04) (18.57) (5.37) (6.96) (40.19) (3.86)

receipt/payment ratio 33.8 38.2 32.2 27.7 24.4 32.3 0.0

2. Such programs as Aid for JCDTs by business owners (including paid leave training), course fee
allowance, workers capability development card program, and SME core job capability development are
included.

As shown in <Table Ⅱ-6-4> below, the trainees from the manufacturing industry and
from finance, insurance, and real estate industries account for 37.0% and 17.6%
respectively among the number of trainees in the JCDT, showing that those industries
provide most training opportunities to the workers.
[Table -6-4] Payments made to assist JCDTs by business owners sorted

according to industry area
(unit: 1,000 won)
Year 2006 2007 Year 2008

2,752,052 3,300,197 3,654,216
Total trainees Total Trainees
(100) (100) (100)
Agricultural fishery 2,306 3,691 Agricultural fishery 4,311
forest mining (0.1) (0.1) forest mining (0.1)
1,159,636 1,440,135 1,352,007
Manufacturing Manufacturing
(42.1) (43.6) (37.0)
88,520 121,953 Electric, gas, running water, sewage, 131,152
Electric gas running water
(3.2) (3.7) garbage disposal, environment restoration (3.6)
160,227 154,994 169,438
Construction Construction
(5.8) (4.7) (4.6)
172,369 200,045 Sales transportation 378,502
Sales food accommodation
(6.3) (6.1) Food accommodation (10.4)
Transportation storage 273,954 292,491 Publication, movie, broadcasting 367,351
communication rent (10.0) (8.9) and communication, information service (10.1)
455,747 465,112 643,931
Finance, insurance, real estate Finance, insurance, real estate
(16.6) (14.1) (17.6)
439,283 621,771 Professional, scientific and skills service, 219,880
Social and private service
(16.0) (18.8) business facility and support service (6.0)
10 5 pubic administration, national defence 43,870
Unknown
(0.0) (0.0) and social security administration (1.2)
343,771
Educational service, etc
(9.4)
3
Unknown
(0.0)
* Note: Numbers inside ( ) shows ratio in percentage (%).

3. Assistance for the Training for the Unemployed People to Change Jobs
The head of local labor office carries out the training for the unemployed who are
changing jobs. The training is for the people who have registered to find a job to local

labor office and, he/she regards, need such training. The cost of training are paid by
the fund established with the insurance premium for JCDP paid by the business

owners who are subject to the plan.
The training for the unemployed who are changing jobs was provided to 65,242 people
who were dismissed from the work places where EI applies in 2007. The number of
beneficiaries in 2008 was 70,565 showing increase of 5,323 from the previous year.
[Table -6-5] Performance record of the training for the unemployed people
changing jobs
(unit: million won)

Year Trained people Total Training costs Training allowance
152,604 126,097 26,507
2007 65,242
(100) (82.6) (17.4)
160,899 133,562 27,337
2008 70,565
(100) (83.0) (17.0)

2. Record is as of the end of the year.
The result of the training as shown in <Table Ⅱ-6-6> below says that though the rate
of people quitting the training in the middle of the course was reduced, the rate of
people who actually got employed was also reduced.
Appendix

[Table -6-6] Performance record of the training for the unemployed people
changing jobs
(unit: million won)
Trainees Quitter Employed after training

Trained
Year completed Employed during Employed after
people the course Number Ratio Total Ratio
the course the course
2007 65,242 31,330 6,790 10.4% 21,911 6,639 15,272 57.7%
2008 70,565 37,666 7,023 10.0% 20,371 6,783 13,588 45.8%
* Employment ratio= (Employed during the course + Employed after the course)/(Employed during the course +
Trainees completed the course) × 100
* Trainings for unemployed woman household head are included.
* Record is as of the end of the year.
IMPROVEMENTS MADE TO THE JOB SECURITY

Chapter 7
PLANS IN 2008
Loan for living expenses to people of low income class who are receiving the JCDT.
- A ground for the loan for living expenses to people of low income class receiving
the JCDT was made in December 2008. The loan was established to address the
problem of low income class and non-regular workers who need the JCDT but
could not receive it because of the burden to be in charge of the livelihood of
his/her family. It was expected that this program will promote the participation by
the vulnerable in the JCDT and, as a consequence, increase their employment
opportunities.
Job Capability Development Account
- There had been criticisms of the JCDP saying that the program was being operated
from the training supplier’
s perspective rather than the participants. The Job
Capability Development Account “JCDA”
( ) was introduced to address such issue.

The JCDA program manages and controls the history and expenses of a worker’
s
JCDT. It gives the trainees the option to pick and choose the institution he or she
wants to take part in. One of the consequences of the trainee having such option is
that the training providers have to compete with each other to attract more

participants to the courses they are providing. It will also increase the motivation of

workers to receive training.
The obligation to preserve the documents related to the loan and subsidy payment
for JCDP is raised.
- The obligation to preserve the documents related to the loan and subsidy payment
for JCDP had not bee prescribed by law but by the Executive Order only. The
obligation was set by the law by this change. The legal requirement is that such
documents should be preserved for 3 years, but in case the cost to install and/or

repair the equipments, machines, and tools were assisted, the preservation period
extended to 10 years. A fine up to 3 million won was set as penalty for not
complying with these obligations.
Punishment for illegal conducts of the Job Training Institutions is clarified
- When a person, who is recognized as a training provider by the Minister of Labor,

is bribed by a business owner and/or a business owners’organization who has been
delegated the JCDT or by the worker who takes part in the program using false
information or by other wrongful method, the government may order him or her to
rectify the wrong doing or cancel the recognition of the course as the JCDT.
Appendix

SECTION
UNEMPLOYMENT BENEFIT
Chapter 1 OVERVIEW
1. What is Unemployment Benefit
Unemployment Benefit “UB”

( ) is one of the three plans of the Employment Insurance
of the Republic of Korea. It supports workers who lost their job by paying him with
benefit so that he/she can support himself/herself and the family. It helps the worker
to find a new job which is appropriate considering his/her ability and aptitude.
UB also helps setting up the employment policy by supplying relevant government
office with the information on movements of the work force. The information is
obtained by systematic management of the information on job offers and job seekers.
UB also automatically controls economic changes by creating effective demand in the
time of recession that in turn will increase employment and suppress the demand by
accumulating the insurance fund when the economy booms.
2. Basic System of UB
UB comprises Job Seeking Benefit “JSB”
( ) and Allowance to Promote Employment
“APE”
( ).
JSB is paid to stabilize the livelihood of the unemployed. It is the core of UB. JSB
includes Sick Benefit “SB”
( ) and Extended Benefit “EB”
( ). SB is paid to the people
who have the same qualification as those who receive UB, but cannot get employed
because of sickness or injury. EB is an extended payment of UB.

APE is paid to assist the UB beneficiaries to find a new job quickly. APE comprises
Early Re-employment Allowance “ERA”
( ), Job Capability Development Allowance
“
( JCDA”), Allowance for Seeking Job in Remote Place “ASJRP”( ), and Moving
Allowance “MA”
( ).

3. Programs in UB Plan

Job Seeking Benefit
Sick Benefit (“SB”)
(“JSB”)
Payment Extended
for Training
(“PET”)
Individual

Extended Benefit
Unemployment (“IEB”)
Benefit (“UB”) Early Re-employment
Allowance (“ERA”)
Special Extension
Allowance
Allowance to Job Capability

Promote Employment Development Allowance
(“APE”) (“JCDA”)
Allowance for Seeking

Appendix
Job in Remote Place

(“ASJRP”)
Moving Allowance
(“MA”)

[Table -1-1] Types of UB
Name Requirements Payment amount

Have worked for more than 180 days in a work place where 50% of average wage he/she
the EI applies during the last 18 months before leaving his/her had received before leaving
last job (a person who left a job before 31 March 2000 needs to the job
have worked more than 6 months during 12 months period) - maximum/day: 40,000 won
* a person who received retirement award in the sum of 100 (30,000 won before 31 Dec.
Job seeking benefit(“JSB”) million Won or more is suspended of receiving UB for 3 2000, 35,000 won before 31
months starting from the date of reporting loss of job Dec. 2005)
Is unemployed despite having the will and ability to work - minimum/day: 90% of
*loss of job by voluntary resignation or by dismissal for minimum hourly rate (70%
serious misconduct is excluded for those who left job before
Must actively seek for job 31. Dec. 1999)
Days not recognized for JSB because of injury, sickness, or Same as JSB
Sick benefit childbirth after reporting loss of job - sickness for 7 days or more
- Shall be paid for 45 days in case of childbirth
An UB payee receiving a JCDT upon the direction of the head 100% of daily JSB payment
of a Job Center amount
- same as JSB payment before
Training extension benefit
31 Mar. 2000
- 70% of JSB payment before
21 Mar. 2008
A person with special hardship in his livelihood and in getting 70% of JSB payment
Individual extension benefit a job who failed to get a job after applying to the positions - up to 60 days
introduced by the head of a Job Center.
A person whose UB payment ended during the period when 70% of JSB payment
the Minister of Labor declared as a difficult period to get a job - up to 60 days
Special extension benefit
for such reasons as sudden and big increase of
unemployment

Name Requirements Payment amount
Early re- A person who gets a job leaving a prescribed period of UB 1/3~2/3 of unpaid JSB
payment * All of unpaid JSB when employed

employment
in manufacturing position in SME
allowance

Job capability A person qualified for UB receiving a JCDT upon the direction Expenses on travel and food
development of the head of a Job Center during the training period
- 5,000 Won/day
allowance
Allowance for When a person seeks a job in a remote region (more than 50 Actual accommodation cost
Allowance to seeking job in km away from his residence) upon introduction of a Job (up to 40,000 won per day)
Promote Center Travel costs: actual costs
remote place
(middle class in each
Employment
transportation medium)
* Shall be calculated according to

the rules on travel allowances
for public servants
Moving When a person needs to move his/her home to get a job or the Actual costs (80% of actual
Allowance receive a JCDT as directed by the head of a Job Center costs exceeding 2.5 tons), 30%
increase when more than 5
family members go along
Chapter 2 JOB SEEKING BENEFIT“JSB”

( )
1. Overview
Appendix
JSB is the most basic and important payment among UB. It is paid to stabilize the
livelihood of the unemployed while he/she seeks a job.
JSB is paid when an insured person lost his/her job and satisfies the unit insured
period of‘more than 180 days during 18 months.’It is paid differently from 90 days
to 240 days depending on the insured period and age of the insured person. Payment
may be extended when certain conditions are met.

2. Requirements to Receive JSB
A. Must satisfy the insured period (section 411 in the EI Act)
The applicant must be an unemployed person who has unit insured period exceeding
180 days among 18 months (criterion period) before the date of leaving his/her last
job. Unit insured period means the days for which wages are paid for. When a person
gets a job after being acknowledged that he/she is qualified to receive UB and lose the
job again, he/she must satisfy the unit insured period again.
B. Cause of dismissal is not among the grounds of exclusion (section 58 of the

same Act)
If the applicant had quit the job to start his/her own business or to move to another
job, or had been dismissed by his/her own serious misconduct, he/she cannot receive
the benefit as he/she had caused an insurance accident, unless his/her voluntary
resignation was based on a justifiable cause such as overdue wage or business
suspension.
Examples of dismissal by serious misconduct
- if dismissed upon being sentenced for imprisonment for violating criminal law or any law
related to his/her work obligations
- if dismissed for causing enormous impediment to the employer’
s business or loss of
property to the employer by committing embezzlement, leaking business secret, destroying
equipment, or making false documents
Further, if the applicant left the job for his/her own reasons, he/she is not disqualified
for JSB, if the reasons are justifiable.

Examples of causes of resignations that do not disqualify JSB receipt
One of the following events happened for more than 2 months during the last 1 year before
leaving the job
- wages are unpaid

- actual working conditions are worse or have become worse than what was represented at
the time of employment or what was generally applied to him or her

- wage received is less than the minimum wage under the‘Minimum Wage Act’
- when the employer breached the restriction of extended work as prescribed in section 53 in
the‘Labor Standard Act’
- when received less than 70% of the average wage he/she used to receive because of the
business suspension of the work place where he/she worked
It is obvious that the business is going to close down or bankrupt, or a massive layoff is scheduled.
When one of the following effects takes place in the work place the employee works in, and
the employee is advised to resign by the business owner or leaves the job by responding to
the business owner’ s call for voluntary retirement application among the workers in

accordance with the job adjustment program of the business as it was inevitable to reduce
the number of the workers in the business:
- sale, acquisition, merge of the business, change of the business area, or closing down of
any of the business item
- reduction or closing of a part following change of the company structure, or change of the
working formula upon adoption of a new technology or technical renovation
- financial hardship, blocking in the company’ s staff promotion or circulation system, or other
events with similar effect of the before mentioned events
When the employee had to take care of his/her family member on their injury or sickness for
more than 30 days, but the employer does not allow him/her to do so
When the employee cannot carry out his/her job properly because of physical weakness,
disability, sickness, injury, or weakening of his/her sense of seeing, hearing, touching and the
employer cannot transfer him/her to another position or give him/her leave. The employee
Appendix
must prove his/her incapability through objective means such as a doctor’ s diagnosis or the
employer’ s opinion letter.
When the employee had to leave the job because he/she was pregnant, gives childbirth, has a
child of less than 3 years old who needs his/her caring, has to answer to the call of duty under
the“Military Service Act”BUT the employer does not allow him/her a leave or job suspension.
* The contents of the Notice were reflected to the Rules of the Employment Insurance Act (Rule 101 Sub-rule 2)
when the Rules were amended on 21 February 2008.

C. The applicant must be unemployed
The applicant must be unemployed when filling out the application to receive JSB. In
other words, he must be unemployed though he/she has the will and ability to work.
Accordingly, a person who operates his/her own business and register as a self-
employed cannot receive JSB.
D. Must receive UB during the receiving period
The Receiving Period means the period when a person can receive UB. It is for 12
months commencing from the next day of leaving the job. The receiving period may
be extended up to 4 years in cases of pregnancy, childcare, injury and sickness of the
employee or relatives of the employee or his/her spouse, and duty service under the
‘Military Service Act’.
There is no limitation period for the application for UB. However, UB is only paid during
the Receiving Period in principle, and shall not be paid when the Receiving Period is over
if the prescribed payment days have not been exhausted. Therefore, the worker who lost
his/her job would better send the application immediately after losing the job.
3. Prescribed Payment Days
A. Overview
JSB is paid in principle from the day after the date of leaving the job when the
applicant is recognized as having satisfied the requirements. The payment is made for
the days when unemployment is admitted up to the Prescribed Payment Period (as set
down in section 48 in the EI Act) during the Receiving Period of 12 months.
The Prescribed Payment Period means the days when a person can receive JSB for
one Receipt Qualification. It is currently set between the minimum of 90 days and the
maximum of 240 days. It is determined according to the age and insured period of the
person who is qualified to receive the JSB (section 50 in the EI Act).

[Table -2-1] The prescribed payment period of JSB
(unit: day)
Insured Less than 1 Year ~ less 3 Year ~ less 5Year ~ less 10 years and
Age
period 1 year than 3 years than 5 years than than 10 years over
Under 30 years 90 90 120 150 180

30 years ~ less
90 120 150 180 210

than 50 years
50 years and over,
90 150 180 210 240
disabled person
* Disabled person is as defined in the “Act to Promote the Disabled People and on Occupational
Rehabilitation.”
B. Calculation of the insured period (Section 41 subsection 2 in the EI Act)
1) Overview

The insured period is the period the applicant was last employed in regard to which
employment he/she is filling out the application for the benefit. However, the period
of employment as uninsured worker is excluded from calculation.
2) Method of calculating the insured period

In case the applicant had worked in another work place besides the last one, and had
got insured again within 3 years of leaving the previous job (1 year for the person
who left the previous job before 31 March 2000), his/her insured period includes the
period he/she was insured while working in the previous job.
However, if he/she received JSB in the intervening period between the two
Appendix
employments, the employment period for which the benefit had been paid is not
incorporated into the insured period.
If the applicant first gets insured more than 3 years before the date when his/her
acquisition as an insured person was confirmed in accordance with section 17 of the
Act, than the calculation of the insured period shall be made on the basis that the
person had got insured 3 years before the day of the confirmation.

Days of working overseas, leave, business suspension, on strike, or working as a full
time union official are all recognized as the insured period because they are admitted
to be continuous working days by the court’ s decision.
4. Payment Amount
A. Amount of JSB
The daily JSB payment amount is calculated by multiplying the BDW1) by 50/100,
provided that if the resulting sum is less than the minimum daily JSB amount then the
minimum daily JSB amount shall be the person’ s daily JSB payment amount.
When the daily JSB payment amount as calculated using the before mentioned
formula is less than the minimum wage, then 90% of the minimum wage (70% for the
person who left the job before 31 Dec. 1999) shall be the minimum daily JSB amount.
B. Basic daily wage for benefit calculation
1) Overview
Basic daily wage for benefit calculation “ ( BDW”) is the average wage as set in
section 19 in the Labor Standard Act (section 45 subsection 1 in the Act).
If the average wage set in the law is less than the average wage the applicant had been
receiving, then the latter shall be the BDW (section 45 subsection 2 in the Act), if the
BDW calculated in the before mentioned manner is less than the sum calculated by
multiplying the legal hourly rate being applied on the day before the worker left
his/her job to the prescribed working hours, then the latter shall be the basic average
wage (section 45 subsection 4 in the same Act).
2) Calculation of the BDW

BDW is calculated with reference to average wage, usual wage, and standard wage in
accordance with section 45 of the Act. Average wage is calculated in accordance with
section 2 of the Labor Standard Act. If average wage is less than usual wage, then
usual wage shall be the BDW (except daily workers).
1) Basic Daily Wage for Benefit Calculation. The term will be explained in detail under the next heading.

The standard wage shall be the BDW in cases where it is difficult to calculate the
average wage or where the average wage was used as the basis of calculating the
insurance premium. However, even when average wage was used as the base of
insurance premium calculation, if the BDW as calculated in accordance with section

45 subsections 1 and 2 is more than the average wage, then the BDW calculated in
such manner shall be used (from 1 January 2005).

When the average wage (usual wage) or standard wage is less than the minimum
BDW, then the minimum BDW shall be used. If it is more than 80,000 Won, then
80,000 Won shall be the BDW.
When the wage earning period for the purpose of calculating the average wage was
less than 2 months, then the average of the wage the worker earned in his prior job
was also used for the calculations. The average wages of both jobs were averaged to
make the average wage fit for the purpose of the BDW calculation. However, the
calculation method for such cases has been changed from 1 January 2004. From then

on, when the person had acquired the insured position 2 or more times within 3
months before leaving his/her last job, then the BDW shall be the amount as
calculated by dividing the total wages he/she had received during the 3 months period
by the days in the 3 months.
BDW = total wages earned during the last 3 months before leaving the last job (the last 4
months’wages minus the last month’
s wages for daily workers) / number of days in the last 3
months before leaving the last job (days in the last 4 months minus days in the last month for
daily workers) Appendix
3) When ascertaining BDW is Difficult

It is regarded that ascertaining BDW is difficult when it is hard to confirm the average
wage despite reasonable effort had been made to do so because of the employer’ s
liquidation, closing down, or disappearance.
In such cases, BDW shall be the amount as calculated by multiplying the hourly
standard wage amount applicable to the worker’ s job by prescribed daily working
hours applied before leaving the job.

5. Payment Procedure (Acknowledging Unemployment)
A person who is acknowledged to be qualified to receive the benefit should attend
once in 1~4 weeks in order to be confirmed of his/her unemployment. JSB is paid for
the days that are recognized as unemployed days (section 44 subsection 1 of the Act).
However, if the applicant is receiving such training as the JCDT upon direction by the
head of the Job Center, he/she only needs to have recognition of unemployment once
in a month (section 44 subsection2 of the Act). In cases when the applicant has
changed the recognition date or in the case of recognition of unemployment by
documentary proof, the recognition procedure is modified accordingly (section 43
subsection 3 of the Act and Rule 63 of the EI Rules).
6. Record of the Payment

UB payment amount in year 2008 was 2,662.2 billion Won, showing increase by
16.5% from the previous year’s payment sum of 2,116.3 billion Won. The number of
beneficiaries was 961,718 showing 14.7% increase from the previous year’
s 123,231.
[Table -2-2] Record of job seeking benefit“JSB”

( ) payment
(unit: million won)
Disti- 2004 2005 2006 2007 2008

nction Beneficiaries Sum paid Beneficiaries Sum paid Beneficiaries Sum paid Beneficiaries Sum paid Beneficiaries Sum paid
JSB 580,486 1,327,226 684,863 1,602,614 753,713 1,833,320 838,487 2,116,268 961,718 2,466,164
* Extended Benefit and Sickness Benefit are excluded.
Chapter 3 SICKNESS BENEFIT
1. Overview
The Benefit Qualified Person2) “ ( BQP”) may receive the Sick Benefit “ ( SB”) in
substitute for JSB while he/she is not able to get employed for more than 7 days
because of sickness, injury, or childbirth during the benefit payment period (section
63 of the Act).
2) A person who is recognized to be entitled to receive Unemployment Benefit.

SB shall be paid upon the BQP ’ s application in regard to the“days that are not
recognized as unemployed days”because of sickness, injury, or childbirth“after
reporting unemployment”(application period: within 14 days after curing of the
disease or the injury, if, however, the nursing days pass over the payment period, then
within 30 days from the end of the payment period).

2. Payment Period
As SB is paid instead of JSB, its amount is the same as that of JSB, may be paid up to
the number of unpaid days during JSB payment period (section 63 and subsection 1
and 2 of the Act). When SB is paid, it is regarded that JSB payment is made (section
63 subsection 2 latter part of the Act).
3. Limitation to the Payment

SB shall not be paid, in order to avoid double dip, when the person has received one
of the following payments (section 63 subsection 4 in the Act and Rule 82 sub-rule 2

of the Rule).
�Compensation for job suspension under the Labor Standard Act
�Business suspension wage under the Industrial Accident Compensation Insurance Act
�Business suspension damages under the State Tort Liability Act
�Awards made under the Act for Honorary Treatment and Support for the People
Injured or Died for Righteous Cause
4. Record of Payment
SB payment in 2008 was 6.9 billion Won, increased by 0.6 billion Won (9.0%) from
the 63 billion Won paid in the previous year, and the number of beneficiaries was 157
Appendix
people, reduced by 60 people (-27.6%) from 217 people in the previous year.
[Table -3-1] Sickness benefit payment record

(unit: million won)
Disti- 2004 2005 2006 2007 2008

nction Beneficiaries Amount paid Beneficiaries Amount paid Beneficiaries Amount paid Beneficiaries Amount paid Beneficiaries Amount paid
SB 689 6,024 502 5,839 225 5,785 217 6,326 157 6,896

Chapter 4 EXTENDED PAYMENT“EP”
( )
1. Payment Extended for Training “PET”

( )
A. Purpose
PET was designed to assist re-employment of the benefit recipients. Under this
program, the head of the Job Center makes a direction to a BQP to receive job
training and, at the same time, the BQP is paid with extended payment of JSB. PET is
paid during the training period not exceeding 2 years 100% of JSB (70% before 21
March 2008) (section 51 of the Act).
B. Requirements to receive PET
The applicant, in order to receive PET, must satisfy the following requirements:
① It is regarded that receiving JCDT will help him/her get another job;
② he/she does not have national skill qualification certificate recognized in the
National Skills Qualification Act and the his/her current skill has is not
demanded by businesses;
③ He/she did not receive any JCDT during the last 1 year period;
④ He/she could not get a job though he/she had applied more than 3 times for the
jobs recommended by the head of the Job Center (this requirement was
introduced on 30 April 2008).
The followings are the occupations and training courses to be recommended under
this program:
① Prior selection occupation training course (occupation area) set by section 53 of
the EI Act and Rule 53 of the EI Rules;

② Example training occupations (big classification) set by the‘Rules on the
payment of subsidiary for JCDP’(Notice by the Department of Labor No.2006-
4) among the‘Courses of JCDT for the Unemployed’set down in section 29
subsection 2 of the EI Act and in section 12 in the Act for the Workers Job

Capability Development Act and Rule 7 sub-rule 1 in the Rules for the same

Act;
③ The JCDT Courses for the Disabled run by the Korean Employment Promotion
Agency for the Disabled which was established by section 2 subsection 7 and
section 43 of the Employment Promotion and Vocational Rehabilitation of the
Disabled (Occupation area);
④ The Training to Raise Craftsmen run by Public Job Training Facilities defined in
section 2 subsection 3 of the Workers Job Capability Development Act and the
Craftsmen Course Training run by the Polytechnic Colleges.

C. Payment record
Payment amount for the PET in year 2008 was 126 million Won, showing increase of
38 million Won (43.2%) compared to 88 million in the previous year. The number of
the beneficiaries in the same year was 37, the same as that of the previous year.
[Table -4-1] Payment record for the payment extended for training
(unit: million won)
2004 2005 2006 2007 2008

Year
Appendix
Beneficiaries Amount paid Beneficiaries Amount paid Beneficiaries Amount paid Beneficiaries Amount paid Beneficiaries Amount paid
Payment
Extended for 2 5 18 22 18 61 37 88 37 126
Training

2. Individual Extended Benefit “IEB”
( )
A. Overview
Individual Extended Benefit is designed to assist the livelihood of the BQP who do
not find a job until JSB payment ends and has family to support (younger than 18
years old for example). It is paid to the BQP up to 70% of the JSB for the period
extended up to 60 days.
B. Requirements for the benefit payment
A person can receive the IEB when he/she meets all of the following criteria and
submit an application for the IEB to the local Job Center of his/her resident area by
the end of JSB payment day together with the certificate of benefit receipt
qualification:
① He/she must have applied, 3 times or more, for the job recommended by the
head of the Job Center more than 3 times but failed to get employed;
② He/she has member of family who need support for sickness that needs treatment
for more than 1 month or who is of the age below 18 or over 65, or who is disabled;
③ He/she needs to receive JCDT but cannot or does not receive one;
④ His/her daily base wage amount is less than 50,000 Won, and the combined asset
of the applicant and his/her spouse is less than 60 million Won (with no house or
building) or pays less than 30,000 Won as the Property Tax.
C. Payment record
The payment made as IEB in year 2008 was in the sum of 332 million Won, reduced
by 480 million Won (-59.1%) compared to payment of 812 million Won in the
previous year. The number of payee also had reduced to 231 from 615 of the previous
year (-62.4%).
[Table -4-2] Payment Record of Individual Extended Benefit“IEB”

( )
(unit: million won)
2004 2005 2006 2007 2008

Year
IEB 156 153 251 239 545 658 615 812 231 332

Chapter 5 ALLOWANCE TO PROMOTE EMPLOYMENT“APE”
( )
1. Early Re-Employment Allowance “ERA”

( )

A. Overview

Early re-employment allowance “
( ERA”) is designed to encourage the benefit
recipients to look for a job diligently. ERA is paid to a BQP who gets employed
before exhausting the prescribed payment period for JSB (s. 64 of the Act).
B. Requirements and payment amount
ERA is paid when the following requirements are all satisfied:

�It is certain that the employment would last more than 6 months (Rule 84 sub rule
1(1) of the Rules);
�The employment is not by his/her last employer or a person related to the last
employer nor the one that was promised before reporting the unemployment
(proviso to Rule 84 Sub rule 1(1) of the Rules);
�The applicant has not received ERA within 2 years before the employment date
(s.64 ss.2 of the Act and Rule 94 sub rule 2 of the Rules).
The amount of the ERA shall be calculated by multiplying the daily JSB amount with;
�2/3 of the number of unpaid days when the applicant gets employed leaving more
than 2/3 of the prescribed payment days,
Appendix
�1/2 of the number of unpaid days when the applicant gets employed leaving 1/3
or more than but less than 2/3 of the prescribed payment days,
�1/3 of the number of unpaid days when the applicant gets employed leaving less
than 2/3 of the prescribed payment days.
- Section 64 subsection 3 of the Act and Rule 85 of the Rules

In case of early re-employment to a SME in the business area noticed by the Minister
of Labor such as the construction, the fishery, or the oil and fat manufacturing
industry as a skilled worker, ERA payment shall be the sum as calculated by
multiplying the daily JSB amount with the number of unpaid days (Rule 85 sub-rule 2
of the Rules).
C. Payment record
The amount of ERA paid in year 2008 was 391.6 billion Won, showing increase of
81.1 billion Won (26.1%) from 310.5 billion Won paid in the previous year. The
number of beneficiaries has increased from 147,694 people to 174,408 people during
the same period showing increase of 26,714 people (18.1%).
[Table -5-1] Payment record of early re-employment allowance

(unit: million Won)
2004 2005 2006 2007 2008

Year
ERA 81,420 114,896 99,925 143,209 121,238 234,116 147,694 310,475 174,408 391,613
2. Job Capability Development Allowance “JCDA”

( )
A. Overview
Job Capability Development Allowance “JCDA”
( ) may be paid to a BQP on top of JSB
when he/she receives job training as directed by the head of a Job Center (s.65 of the Act).

JCDA is paid to a BQP when he/she receives job training as directed by the head of
the Job Center on the“days he/she received the job training etc”during the days
when JSB is to be paid (Rule 88 of the Rules). JSB is determined and noticed by the
Minister of Labor taken into account of the costs necessary to attend job training such
as expenses for food and travel (Rule 88 sub rule 2 of the Rule).

C. Payment record
JCDA was paid to 176 people in the sum of 23 million Won.
[Table -5-2] Payment record of job capability development allowance“JCDA”

( )

(unit: million Won)

2004 2005 2006 2007 2008
Year
JCDA 11 1.3 87 7 139 13 176 16 176 23
3. Allowance for Seeking Job in Remote Place “ASJRP”

( )
A. Overview
The head of the Job Center may pay Allowance for Seeking Job in Remote Place

“ASJRP”
( ) when a BQP seeks a job in a remote place as advised by the Job Center,
the amount to cover the expenses for the travel and accommodation relating to the job
seeking activities in the remote place (s.66 of the Act, Order 89 of the Orders, and
Rule111 of the Rules).
ASJRP is paid when a BQP satisfies all of the following requirements (R.89 of the
Rules):
① The job seeking activity must start after expiring of the waiting period as set in
Appendix
Rule 49 of the Employment Insurance Rules;

② The expenses related to job seeking activities are not paid by the business owner
the BQP is visiting or, if paid, the amount paid by the business owner is less than
the amount of ASJRP;
③ The distance between the BQP and the work place he/she is visiting for the job
seeking activity is more than 50 km.

ASJRP is composed of train fare, bus fare, ship fare, and accommodation expenses
(Rule 111 sub-rules 2 and 3 of the Rules). The fare is calculated on the basis of the
distance from the place of the BQP’s residence to the visiting work place and the
accommodation expenses is on the basis of the number of nights he/she stayed over.
C. Payment record
ASJRP was paid to 68 people the sum of 2 million Won in year 2008.
[Table -5-3] Payment record of the allowance for seeking job in remote place
“ASJRP”
( )
(unit: million won)
2004 2005 2006 2007 2008

Year
ASJRP 8 0.28 69 2.53 46 1.62 29 1 68 2
4. Moving Allowance “MA”

( )
A. Overview
A BQP may receive moving allowance “MA”

( ) when he/she moves home upon employment
or to receive job training etc as directed by the head of the Job Center (s.67 of the Act).
Moving Allowance shall be paid when the BQP gets employed or gets training after
expiration of the waiting period and the head of the Job Center covering the BQP’
s
resident area acknowledge that moving of residence is necessary. However, Moving
Allowance shall not be paid if the BQP ’
s employment is for a period less than 1 year
(Reg. 90 sub-regulation1 of the Regulations).
Moving allowance amount is determined according to the moving distance as set in

the Rules on the travel expenses for public servants as shown on the annexed table 2
referred to in rule 16 sub-rule 1 of the Rules (Rule 113 Sub-rules 1 and 2 of the Rules).

C. Payment record
Moving Allowance paid in year 2008 is 100 million Won, has increased by 53 million
Won (112.7%) from 47 million Won of the previous year. The number of beneficiaries

was 376.

[Table -5-4] Payment record of moving allowance
(unit: million won)
2004 2005 2006 2007 2008

Year
Moving
223 36 296 42 347 50 347 47 376 100
Allowance

Chapter 6 RESTRICTION ON PAYMENT AND ORDER TO REPLAY THE
BENEFIT UPON FINDING OF RECEIPT BY WRONGFUL MEANS
1. Overview
Unpaid Benefit is made to assist, through payment of JSB, person who lost job with
his/her livelihood during the period of unemployment and help him/her to get another
job which is suitable for him/her considering his/her capability and aptitude.
When an insured person receives or attempts to receive the benefit by intentionally
failing to report his/her employment or income, by providing false information, or by
Appendix
any other wrongful method, he/she is totally ignoring the purpose and the goal of the
plan. Such activities are regarded as wrongful receipt. The benefit is either not paid or
order is made to return the paid benefit in such cases.

2. Examples of Wrongful Conducts
The followings are the examples of wrongful conducts:
① False reporting of the dates of getting insured or become uninsured to the EI;
② False recording of the reason of leaving the job or the wage amount;
③ Failing to report employment or earning of income through side job;
④ Using other person’
s qualification as an insured, fake dismissal;
⑤ Filling out legal form with false information and/or counterfeiting legal
document or evidentiary document;
⑥ False evidentiary document by the business owner presented to receive APE.
3. Discontinuance of Payment
Payment of UB stops from the day when the beneficiary receives or attempts to receive
the benefit by false or other wrongful method (s.6 ss.1 of the Act, R.80 of the Rules).
However, if the person did the wrongful conduct such as concealing the fact that
he/she is employed or has income or lying about his/her job seeking activities only
once, then benefit for that particular recognized unemployment period shall not be
paid and payment will be made from then on. If the wrongful conduct is committed
for a couple of times or more, then the benefit payment shall stop completely upon
the second wrongful conduct (s.61 ss.2 of the Act).
4. Judging False Reporting
Simple error in the recording of his/her days of employment or of the amount of wages
in filling out the application form for recognition of unemployment shall not be
regarded as a wrongful conduct. When a person intentionally record wrong information
or record his/her employed days or wage amount less than what they actually were so as
to receive JSB, such conducts amount to false or other wrongful method.
5. Repayment Order and Decision to Collect Penalties
A. Overview (Section 62 of the act and rule 81 of the rules)

It is possible, apart from the right to claim return of wrongful enrichment under the

Civil Code, to order a person who received UB by false or other wrongful method to
return the paid benefit and, in addition to it, to collect penalty in the sum up to the
same amount as the benefit received by false or wrongful method.
If the business owner took part in the wrongful conduct, it is possible to make him
jointly responsible for the return of the ordered amount and the penalty payment.

B. Object of the repayment order

1) A person who received or attempted to receive UB by false or wrongful method
The person does not have to be a BQP. A person who forfeited job leaving
confirmation with no qualification to receive the benefit, and anyone who used
other person’s certificate of qualification to receive the benefit fall into this
category.
2) The order making the business owner a joinder shall be made only when the

business owner has;
① employs or has employed, actual employment or fake employment included, the
person who wrongfully received the benefit,
② abetted and/or aided the wrongful receipt of the benefit and committed false
reporting or provided false evidentiary document as a means of the abetting
and/or aid.
C. Amount to be ordered to repay

The amount ordered to be repaid shall be the sum equivalent to the amount received
by wrongful method (including the amount paid after the date the payment stopped). Appendix
[Table -6-1] Record of wrongful receipt of UB

(unit: million won)
Paid UB Wrongful payments Ordered

Wrongful Wrongful receipt Repayment
Beneficiaries Amount paid % % Amount
beneficiaries amount
990,061 2,865,256 19,133 1.9 8,673 0.3 16,073

Chapter 7 UNEMPLOYMENT BENEFIT“UB”
( )
PAYMENT RECORD IN 2008
1. UB Payment Record
A. Application and payment of UB
New applicants for UB in 2008 was 838,783 showing increase of 151,018(22.0%)

from 687,765 of the previous year. The number of UB beneficiaries was 990,061,
showing increase of 135,661(15.9%) from 854,400 of the previous year. Accordingly,
the amount of paid UB in the year was 286.5 billion Won, has increased by 43.12
billion Won (17.7%) from 243.4 billion Won paid in the previous year.
[Table -7-1] Record of application for and payment of UB

(unit: million won)
Amount Paid
Benefit Payment
New First time Recognized Allowance to
Year qualified beneficiaries completed Job seeking encourage
applicant beneficiaries unemployment Total
persons beneficiaries benefit re-
employment
1996 10,133 9,914 7,308 7,308 969 27,031 10,459 9,986 473
1997 51,017 50,312 48,677 40,426 28,931 260,665 78,732 76,155 2,577
1998 438,465 434,199 412,600 376,383 251,517 2,480,448 799,154 783,881 15,273
1999 327,954 325,220 462,635 303,332 404,517 2,440,410 936,185 913,948 22,237
2000 260,574 258,727 303,631 225,739 286,609 1,743,144 470,793 445,909 24,884
2001 349,148 347,303 374,286 315,211 263,344 2,743,568 845,109 787,960 57,149
2002 299,215 297,109 362,895 276.113 297,819 2,476,271 839,319 778,232 61,087
2003 379,600 375,561 433,798 344,281 310,876 2,965,339 1,030,304 950,424 79,880
2004 471,542 467,730 589,611 470,761 495,697 3,781,280 1,448,306 1,333,409 114,896
2005 565,753 562,524 696,544 546,917 539,734 4,207,599 1,751,974 1,608,714 143,260
2006 612,667 609,691 767,314 598,623 595,230 3,423,871 2,074,004 1,839,823 234,181
2007 687,765 685,024 854,400 673,243 663,938 3,538,983 2,434,032 2,123,494 310,538
2008 838,783 835,140 990,061 789,053 750,816 3,948,154 2,865,256 2,473,518 391,737
* Job Seeking Benefit includes Sickness Benefit.

B. Payment record of each benefit
UB paid in 2008 was 286.5 billion Won comprising:

� JSB payment of 2,466,623 million Won (86.1%);
� APE payment of 391,737 million Won (13.7%);

� SB payment of 6,898 million Won (0.2%).

The payments have increased from the previous year in the following rates:
� JSB 16.5%;
� APE 26.1%;
� SB 9.0%.
[Table -7-2] Payment record of each benefit of the UB

(unit: million Won)

Allowance to promote employment
Job
Early re- Job Allowance Sick
Year Total seeking Sub- capability Moving for seeking
employment benefit
benefit total development allowance job in remote
allowance allowance place
1996 10,459 9,958 473 469 4.0 0.0 0.0 28
1997 78,732 75,943 2,577 2,558 19.0 0.0 0.0 212
1998 799,154 782,865 15,273 15,257 15.1 1.6 0.1 1,016
1999 936,1859 11,308 22,237 22,225 4.5 7.0 0.0 2,640
2000 470,793 443,546 24,884 24,877 0.3 6.8 0.0 2,363
2001 845,109 783,861 57,149 57,120 2.2 27.4 0.0 4,099
2002 839,319 773,861 61,087 61,055 3.6 28.4 0.0 4,371
Appendix
2003 1,030,304 945,599 79,880 79,853 - 27.0 - 4,825

2004 1,448,306 1,327,384 114,896 114,859 1.3 36.1 0.3 6,024
2005 1,751,974 1,602,875 143,260 143,209 7 42 2 5,839
2006 2,074,004 1,834,039 234,181 234,116 13.3 49.8 1.6 5,784
2007 2,434,032 2,117,168 310,538 310,474 15.6 47.3 1 6,326
2008 2,865,256 2,466,623 391,737 391,613 22.8 100 2 6,896
* Job Seeking Allowance includes Extended Benefit.

C. UB applicants sorted by cause of leaving job
(unit: million won)
Liquidation Job Recommen Expiry of

or
Year Total closing adjustment ded Retirement employment Other
down of
business (Redundancy) resignation term
1997 51,017 14,090 5,895 16,157 5,539 9,336

1998 438,465 62,338 80,810 219,959 11,196 64,162
1999 327,954 24,254 50,428 170,553 17,263 65,456
2000 260,574 27,302 19,079 140,113 8,844 34,670 30,566
2001 349,148 33,358 20,178 213,641 9,685 37,621 34,665
2002 299,215 26,529 13,167 194,988 9,319 32,216 22,996
2003 379,600 34,314 19,994 250,610 10,067 38,375 26,240
2004 471,542 38,572 29,169 304,174 11,644 56,146 31,837
2005 565,753 38,739 32,397 342,889 13,659 79,203 58,866
2006 612,667 36,816 35,690 348,427 15,069 98,803 77,862
2007 687,765 37,979 48,925 370,379 16,284 117,804 96,394
2008 838,783 44,549 55,636 444,069 17,977 147,418 129,134
D. Record of UB payment sorted by the size of the work place
52.2% of UB beneficiaries in 2008 were from work places having less than 30
employees, and 11.3% from work places with 500 or more employees.
[Table -7-3] UB payment amount sorted by the size of the beneficiary’

s last work place
(unit: million won)
Less than 1000

30~99 100~299 300~499 500~999
Year Total 29 employees
employees employees employees employees
employees and over
1996 10,459 626 1,881 2,107 818 2,663 2,364
1997 78,732 3,472 17,641 17,855 6,063 9,210 24,491
1998 799,154 55,349 200,190 154,468 60,143 83,557 245,447

Less than 1000
5~29 30~99 100~299 300~499 500~999
Year Total 5 employees
employees employees employees employees employees

employees and over

1999 936,185 27,231 163,977 177,700 157,627 73,135 80,679 255,836
2000 470,793 55,301 125,100 88,592 74,502 29,288 32,377 65,633
2001 845,109 95,758 223,926 150,538 123,179 45,690 58,531 147,487
2002 839,319 112,650 247,502 155,517 122,365 41,475 52,487 107,323
2003 1,030,304 147,986 336,791 206,427 143,109 45,670 52,351 97,970
2004 1,448,306 242,798 475,113 259,115 192,970 63,466 65,967 148,876
2005 1,751,974 295,647 590,579 320,076 243,669 80,808 85,054 136,141
2006 2,074,004 352,186 691,087 381,327 301,296 96,456 96,465 155,187
2007 2,434,032 428,359 802,711 446,974 350,074 113,191 113,199 179,524

2008 2,865,256 531,355 966,950 515,740 397,322 129,756 128,357 195,776
E. Record of payment sorted by gender and age of the beneficiaries
Male beneficiaries were 55.0% of all beneficiaries. In terms of age groups, people in
thirties were occupying 28.6% of total beneficiaries followed by people of less than
29 years old, occupying 22.9% and forties 22.7%. The payment amount has increased
throughout all age group compared to the previous year.
[Table -7-4] Number of UB applicants sorted by gender

Appendix
2003 2004 2005 2006 2007 2008

Year
Payee Increase
(%) Payee Increase
(%) Payee Increase
(%) Payee Increase
(%) Payee Increase
(%) Payee Increase
(%)
379,600 471,542 565,753 612,667 687,765 838,783
Total 26.9 24.2 20.0 8.3 12.3 22.0
(100) (100) (100) (100) (100) (100)
214,441 257,931 311,226 336,365 374,818 461,672
Male 20.9 20.3 20.7 8.1 11.4 23.2
(56.5) (54.7) (55.0) (54.9) (54.5) (55.0)
165,159 213,611 254,527 276,302 312,947 377,111
Female 35.6 29.3 19.2 8.6 13.3 20.5
(43.5) (45.3) (45.0) (45.1) (45.5) (45.0)
* Numbers in ( ) represent proportion to total in percentage.

[Table -7-5] Number of UB applicants sorted by age
2003 2004 2005 2006 2007 2008

Age
Payee Increase
(%) Payee Increase
(%) Payee Increase
(%) Payee Increase
(%) Payee Increase
(%) Payee Increase
(%)
Less 30,222 39,901 43,805 42,111 41,115 43,378
26.7 32.0 9.8 △3.9 △2.4 5.5
than 25 (8.0) (8.5) (7.7) (6.9) (6.0) (5.2)
79,944 98,200 109,243 115,022 126,772 148,768
25~29 22.7 2287 11.2 5.3 10.2 17.4
(21.1) (20.8) (19.4) (18.8) (18.4) (17.7)
112,787 142,919 164,609 178,185 197,260 239,740
30~39 25.8 26.7 15.2 8.2 10.7 21.5
(29.7) (30.3) (29.1) (29.1) (28.7) (28.6)
83,280 98,876 120,442 132,492 151,417 190,282
40~49 32.4 18.7 21.8 10.0 14.3 25.7
(21.9) (21.0) (21.3) (21.6) (22.0) (22.7)
62,130 74,271 95,238 108,498 126,645 158,718
50~59 27.0 19.5 28.2 13.9 16.7 25.3
(16.4) (15.8) (16.8) (17.7) (18.4) (18.9)
Over 11,237 17,375 32,416 36,359 44,556 57,897
29.5 54.6 86.6 12.2 22.5 29.9
60 (2.9) (3.7) (5.7) (5.9) (6.5) (6.9)
F. Record of UB payment sorted by industry
UB payments are paid to the industries in the following proportion:

�Business, individual, other service 31.3%;
�Manufacturing 29.3%;
�Mining 0.3%.

[Table -7-6] Record of UB payment sorted by the industry
(unit: million won, %)
2003 2004 2005 2006 2007 2008

Age
Amount Increase Amount Increase Amount Increase Amount Increase Amount Increase Amount Increase
paid paid paid paid paid paid

1,030,304 1,448,306 1,751,974 2,074,004 2,434,032 2,865,256
Total 22.8 40.6 21.0 18.4 17.4 17.7
(100) (100) (100) (100) (100) (100)

Agriculture 5,631 6,445 11,033 17,649 20,224 27,871
△2.7 14.5 71.2 60.0 14.6 37.8
Fishery (0.5) (0.4) (0.6) (0.9) (0.8) (1.0)
4,227 4,022 8,495 5,697 5,999 8,248
Mining △43.7 △4.8 111.2 △32.9 5.3 37.5
(0.4) (0.4) (0.5) (0.3) (0.3) (0.3)
386,762 534,259 631,484 721,262 816,167 840,509
Manufacturing 19.8 38.1 18.2 14.2 13.2 3.0
(37.6) (36.9) (36.0) (34.8) (33.5) (29.3)
78,039 108,606 159,962 227,037 284,297 396,397
Construction 4.0 39.1 47.3 41.9 25.2 39.4
(7.6) (7.5) (9.1) (10.9) (11.7) (13.8)
Sales, Food 152,934 207,704 245,715 277,537 314,115 373,028
42.5 35.8 18.3 13.0 13.2 18.8

Accommodation (14.9) (14.3) (14.0) (13.4) (12.9) (13.0)
Business, 289,689 412,727 529,614 647,236 800,099 898,034
Individual, 30.7 42.5 28.5 22.2 23.6 12.2
other service (28.1) (28.5) (30.2) (31.2) (32.9) (31.3)
Electric, 62,292 111,799 91,337 119,606 133,172 262,038
transportation 16.6 79.5 △18.3 31.0 11.3 131.5
storage,
communication (6.0) (7.7) (5.2) (5.8) (5.5) (9.1)
Finance, 50,730 62,743 74,334 57,979 59,959 59,132
10.9 23.7 18.5 △22.0 3.4 △1.4
insurance (4.9) (4.3) (4.2) (2.8) (2.5) (2.1)
Note) The Data for year 2008 are based on the 9th Amendment to the Standard Industry Classification and,
accordingly there may be discontinuance in terms of time with the data for the years up to 2007 that are
based on the 8th Amendment. Data for year 2008 on industries other than Agriculture, mining,
manufacturing, construction, transportation, and finance and insurance are using different Industry
Classification from those of years until 2007. Appendix

SECTION
PROTECTION OF MATERNITY AND
SUPPORTING WORK AND LIFE BALANCE
Chapter 1 OVERVIEW
1. Purposes and Goals

The women, through pregnancy and childbirth, produce the work force of next
generation. Working women, who is productive in terms of work and work force,
need appropriate social protection for their special roles. The Maternity Protection
Policies contain comprehensive policies answering to such social needs. They include
prior and post childbirth leave, prohibition of overtime working and restriction on the
night and/or weekend shift of pregnant woman, prohibition of hiring female workers
in hazardous and/or dangerous businesses, menstruation leave, and nursing hours.
Further, many programs have been introduced; first, to catch up with the change of the
workers’views on work and life, and to increase competitiveness of businesses by
supporting the workers to maintain the work and life balance. They are such programs
as childcare leave and establishing childcare facilities in the work places.
2. Areas of Female Workers’Maternity Protection

Plans Categories Programs
prohibition on recruitment of female workers in hazardous and/or dangerous work
Mothers’
places
health and
Limitation on working hours, Restriction on working at night and/or on weekends and
Maternity protection safety
holidays
Maternity Leave Prior and post childbirth (miscarriage and stillborn included) leave, menstruation leave
Supporting Childcare Support Nursing hours, Assistance to Childcare Facilities in Work Places
work and life
balance Childcare Leave Childcare Leave, Reduction of Working Hours during Childcare Period

The background of the socialization of the maternity protection responsibility:
Women’ s participation in the economic activity is expanding. More and more women
are taking part in the economic activities. It is one of inescapable phenomena of a
society with low childbirth rate and aging population. It is a challenge for the state,

the women, and the businesses to accommodate female work force. Advanced
countries already set the best use of the woman work forces as a priority in making

policy. Businesses also are paying more attention to the female work force as a way to
diversify their human resources pool and intensifying their competitiveness.
In Korea, the rate of women taking part in the economic activities was 50.0% in 2008,
however, the rate has stalled since year 1997 when the rate was 49.8%. Many women
leave the labor market in their thirties for such reasons as pregnancy or child caring,
causing disruption to their careers. This phenomenon is named the M curve, which is
not common to men. The statistics on workers by their ages shows that the rate of

women participating in the economic activities is the highest in the age group
between 20 and 29 as 69.3% and then reduced by 13% to 56.1% in the thirties,
showing stark comparison to male workers whose participation rate in the economic
activities reaches the highest figure of 93.6% in their thirties.
Korea, in establishing its labor market policies, not only expands the quantity but also
improves the quality of women’ s jobs.
The childbirth leave for female workers had been for 60 days until year 2001, and the
responsibility for wages during the leave period were all left to employers. Then
changes have been made upon strong public opinions of the labor circle and women
claiming that the level of maternity protection must meet the international standard3).
Appendix
The first change was made in 2001 by amending the Labor Standard Act, the Act to
promote equal employment of men and women, and the Employment Insurance Act,
so called the three maternity protection statutes. The amendments were noticed on 14
August 2001 and came into force on 1 November 2001. The changes included
3) ILO MATERNITY PROTECTION CONVENTION 2000 says; that a woman should be able to have 14 weeks of
Childbirth Leave, that the woman worker should receive during the leave not less than 2/3 of her normal wage, and
the wages during the leave must be provided through social insurance or public fund (no individual should be made
responsible for the direct monetary costs).

extension of the childbirth leave period from 60 days to 90 days, and the
responsibility for the wages during the extended 30 days period were to be assumed
by the general national budget and the social insurance (Employment Insurance).
Another amendment to the three maternity protection statutes was made on 31
December 2005. Wages for the 90 days of childbirth leave are to be paid by the
Employment Insurance for the priority corporations (aid to the big corporations were
to remain the same as before). Aid to the priority corporations for the wages during
the leave on miscarriage or stillbirth were also to be covered by the insurance. The
amendments have been effective since 1 January 2006.
Chapter 2
CONTENTS OF THE MATERNITY PROTECTION
BENEFITS
1. Childbirth Leave Benefit (Including Miscarriage and Stillbirth

Leave Benefit)
Benefit of leave before and after giving childbirth and benefit of leave on miscarriage
or stillbirth (together shall be called‘Childbirth Leave Benefit (CLB)’) are paid to
the insured who satisfies certain requirements (the‘ Qualified Person for the
Childbirth Leave Benefit (QPCLB)’). It is an additional remuneration to an employed
person.
CLB is paid when the following conditions are all satisfied:

� The insured must have been given a childbirth leave as prescribed in section 74
of the Labor Standard Act;
� The insured period of the worker must be 180 days or over on the date when the
childbirth leave ends;
� The insured person must apply for the benefit within 12 months from the date
when the childbirth leave ends.

CLB amount shall be the amount equivalent to the usual wage of the beneficiary
under Labor Standard Act at the beginning of the childbirth leave. If the amount
equivalent to the usual wage exceeds 1.35 million Won, then 1.35 million Won shall
be paid as CLB.

2. Childcare Leave Benefit “Childcare
( Benefit”)

Childcare Leave was introduced in November 2001. A worker who had a baby
younger than 3 years of age (born after 1 January 2008) was able to take leave to take
care of the baby for 1 year. Changes have been made to the program by amendment to
the Act to Encourage Equal Employment of Men and Women made on 21 December
2007. After the change, the childcare leave may be taken for 2 separate periods and
the leave period may be used to the end even if the worker’
s baby reaches the age of
3 during the leave period. Total leave period is 1 year.

Childcare Leave Benefit is for worker who takes the childcare leave out of the
Employment Insurance Fund. It pays a total of 500,000 Won per month. Childcare
leave period used in year 2008 was 216 days by women and 191 days by men.
Women took 25 days more than man for childcare.
* Amount of childcare leave benefit: 300,000 Won per person per month in year 2003 => 400,000
Won per person per month from 25 February 2004 => 500,000 Won per person per month from
27 April 2005
Childcare benefit is paid when the following conditions are all satisfied:
� The insured must have been given childcare leave for no less than 30 days as
prescribed in the Act to Encourage Equal Employment of Men and Women;
Appendix
� The insured period of the worker must be 180 days or over on the date when the
childcare leave begins;
� The spouse of the insured, who is also insured, must not be given childcare leave
for more than 30 days in regard to the same baby of theirs;
� The insured person must apply for the benefit from 1 month after the beginning
of the leave and before 12 months after the end of the leave.

3. Result and Evaluation of the Maternity Protection Benefit
The childbirth benefit and the childcare benefit were not very popular between years
2001 and 2002, the early days of its operation, because of poor publicity and
recognition by relevant people. However, continuous public advertisement, guiding
and coaching to the businesses, and improvements made on the program increased the
demand for the benefit. Childcare Benefit was paid to 68,526 people the sum of
166,631million Won in year 2008, showing increase in the number of beneficiaries by
17.4% and the payment amount by 25.8% from year 2007.
Childcare Leave Benefit, which was first introduced on 1 November 2001, was paid
to more than 10,000 people in 2005 for the first time. It was paid to 29,145 people the
sum of 98,431 million Won in 2008, increased by 37.6% in terms of beneficiaries and
by 61.4% in the payment amount. The number of people who took the childcare leave
was 42.5% of the people who took the childbirth leave in year 2008. The ratio
increased by 6.2% than year 2007 when the ratio was 36.3%.
On the other hand, the number of male workers who took the childcare leave was 355
in 2008. The number is increasing every year but the ratio of male workers taking the
childcare leave is only 1.2%, and the average of the days the male workers taking the
childcare leave is 191, which is by 25 days less than 216 days of female workers. The
figures reflect our childcare practice which put all the burden on woman.
[Table -2-1] Annual payment record of maternity protection benefit

(unit: million won)
Childbirth leave benefit Childcare leave benefit

Year
Payees Amount paid Payees Amount paid
2002 22,711 22,602 3,763 (M 78, W 3,685) 3,087
2003 32,133 33,522 6,816 (M 104, W 6,712) 10,576
2004 38,541 41,610 9,303 (M 181, W 9,122) 20,803
2005 41,104 46,041 10,700 (M 208, W 10,492) 28,242
2006 48,972 90,886 13,670 (M 230, W 13,440) 34,521
2007 58,368 132,412 21,185 (M 310, W 20,875) 60,989
2008 68,526 166,631 29,145 (M 355, W 28,790) 98,431

Chapter 3
DISCONTINUANCE AND RETURN OF BENEFIT
PAYMENT
1. Discontinuance of Benefit Payment

If the worker, who is receiving either Childcare Benefit or Childbirth Benefit, leaves

the job or gets another job, then the benefit payment stops.
In case the insured receives or attempts to receive the benefit by false or other
wrongful means, then the benefit payment stops from the day of such payment or
such an attempt.
2. Return of Benefit for Wrongful Conduct of the Insured Person

It is possible to order return of all or part of childbirth benefit and childcare benefit
that had been paid to the person who received those benefit by false or wrongful

means. It is also possible to impose penalty on the person up to the same amount as
the benefit received by false or wrongful means. The penalty amount shall be 100/100
of the benefit paid, but may be waved if the person voluntarily reports his/her wrong
doing.
A person who has objection to the decision made by in regard to the childbirth leave
benefit or childcare leave benefit may appeal to the Employment Insurance Referee.
3. Record of Discovered Wrongful Receipts

There was no discovered case of wrongful receipt of the benefit in 2001. The number of
people who were discovered for receiving the benefit by wrongful means was 9 in year
2002, 21 in 2003, 28 in 2004, 27 in 2005, 27 in 2006, 32 in 2007, and 49 in 2008.
Appendix
The wrongful conducts included;

reporting the days and period of the leave falsely,
working during the leave period, and
failing to report that he/she has got another job or has left the job.
People who do not repay the benefit they had received by wrongful means are urged
to return the money. If they do not follow the order over a certain period, such
methods as confiscation of their assets are used to recover the money.

[Table -3-1] Record of discovery and recovery of benefit paid by wrongful means
(unit: million won)
Number of
people who Amount of Ratio of
Total amount
had received benefit paid benefit paid
Year of paid
the benefit on wrongful by wrongful
benefit by wrongful application means
means
2000 - - - -
2001 7 - - -
2002 25,668 9 4 0.016
2003 44,098 21 14 0.032
2004 61,963 28 12 0.020
2005 74,283 27 26 0.035
2006 125,407 27 29 0.023
2007 193,401 32 31 0.016
2008 265,062 49 29 0.011
* Ratio of benefit paid by wrongful means: Amount of benefit paid on wrongful application / Total Amount of Paid
Benefit x 100

SECTION
ADJUDICATION ON EMPLOYMENT
INSURANCE

1. Purpose

Adjudication on Employment Insurance “ ( AEI”) is administrative review procedure.
AEI deals with complaints on the decision by the head of a Job Center in regard to such
matters as UB, Childcare Leave Benefit, Childbirth Leave Benefit, and Confirmation of
the insured person’ s qualifications. The jurisdiction AEI is prescribed in the
Employment Insurance Act(section 104 subsection 2 in the Employment Insurance
Act). Any other complaints shall be adjudged by general adjudication procedure.
2. Application and Decision Making of AEI

A. Application
1) Submitting application
Application for AEI must be in writing(s.91 of the EI Act). The adjudication
proceedings commence upon submission of the application. The proceedings are
carried out by documentary review. Therefore, an applicant who submits an
application which provides incorrect or insufficient information may not get
satisfactory result. The application must be concise and clear.
2) Place to submit application

The application must be submitted to the Job Center whose decision is being
Appendix
complained about. The Job Center that received the application must forward the
document to a referee within 5 days from the receipt with their opinion annexed
thereto (s.90 of the Act).
3) Receiving application
When an application is submitted to a government office, then the office must accept
the document. Even if the office receiving the application is not the proper office to

be accept the application, the office may not reject to receive the document nor return
the received document. Even when it looks that the application is not in compliance
with the law, the document may not be rejected of receipt or returned after receipt.
When a government office receives an application for AEI, the office must record the
receipt on the log book for civil appeal. When the referee was forwarded an
application, he/she must record it on the log book on the receipt and disposal of
application for AEI, and keep it in a separate place.
B. Transferring an application
1) When an application for AEI was submitted to a wrong government office
When a person submits the application for AEI to a wrong government office, then
the office must immediately transfer the document to the proper office and let the
person know that the document has been transferred.
2) Forwarding of the application
The head of the Job Center, whose decision is being complained of, unless the
applicant withdraws the application, must forward the application for AEI to the
referee with his/her opinion on the application annexed thereto.
C. Requirements of an application for AEI

The application for AEI must be;
made by a person who is qualified to file the application,
in regard to a decision on UB etc that can be the object of the application for AEI,
within the prescribed period,
in accordance with a certain manner, and
to the Job Center that made the decision to be complained of.
[Table -1-1] Requirements of the application for AEI
A person who has objection to a decision made by a Job Center in regard to UB payments etc can be an applicant.
Applicant The Job Center shall be respondent.
The application shall be made to the referee.
Decisions regarding acquisition and loss of the status of the insured person, UB, Childcare Leave Benefit,
Object of application
Childbirth Leave Benefit
Manner of application In accordance with the manner prescribed in the Employment Insurance Act
Time of application Within 90 days from the date when the applicant were informed of the decision.

1) Parties of the application for AEI
Applicant and Respondent are parties of the application. A person whose right or
interest is invaded by the decision of the head of a local Job Center can be an
applicant. The head of the local Job Center shall be respondent.

A natural or legal person, who has the rights and abilities by the Civil Code or by
other laws, may be an applicant. However, a minor, an incompetent, or a quasi-

incompetent may only file the application through a legal representative.
2) Object of adjudication
Section 87 subsection 1 of the Employment Insurance Act prescribes the object of the
adjudication as follows:
A person who has objection to the decisions including;

� confirmation of the acquisition and the loss of the status of insured person under
section 17,

� UB under chapter 4;
� Childbirth Leave Benefit and Childcare Leave Benefit under chapter 5,
may file for adjudication and appeal against the decision made in the Adjudication.
Therefore, among the decisions of the Job Center the following only may be
subjected to AEI under section 87 of the Employment Insurance Act:
① confirmation of the acquisition and the loss of the insured person status;
② UB;
③ Childbirth Leave Benefit and Childcare Leave Benefit.
3) Time of application
The application must be filed within 90 days from the date either when the decision
Appendix
was made or when the applicant gets to be aware of the decision. An application filed
after that filing period shall be dismissed as unsuitable. The“date when the applicant
gets to be aware of the decision”means the day when the applicant gets to know the
decision through notice, public notice, or any other means. The“date when the
decision was made”means the day when the decision becomes effective.
In regard to the notice by the administrative office, if the notice advises, by mistake,
the application period longer than it actually is, then the application made within the

period advised in the notice is valid. If there is no advice as to the application period
for AEI, then the application may be filed within 180 days (Section 18 subsections 5
and 6 of the Adjudication Act). In such cases, it is immaterial whether the applicant
actually knew the application period as prescribed by the law.
D. Adjudgment
1) Decision on the procedure and on the substance

The adjudication is proceeded through 2 stages. First, it is considered whether the
application is in accordance with the legal prescriptions. If the application does not
pass this screening, it is dismissed without judging the substance of the application.
When the application passes the procedural screening, then the substance is looked at. If
it is decided that the application is righteous, then a decision cancelling the decision of
the Job Center shall be made. Otherwise, the application shall be rejected or dismissed.
2) Limitations on decision
The referee cannot make a decision on the matter that is not raised in the application.
Nor can he make a decision that is more disadvantageous than the decision
complained against.
3) Suspension of execution
Application for AEI does not suspend execution of the original decision made by the
Job Center. However, if the referee regards that it is necessary to suspend the original
decision in order to prevent serious damage to be caused by the original decision, he
or she may suspend execution of the original decision (s.9 of the Act).
4) Effect of the decision

The decision made by AEI is quasi-judicial. It, as a precedent, binds subsequent cases.
5) Time of decision
The decision of AEI must be made within 30 days from the date when the original
decision making office (respondent in the application) receives the application for
AEI. However, extension for once for a period no more than 10 days, when there is a
compelling reason, is allowed.

6) Unsatisfactory decision
The applicant who is not satisfied with the decision of AEI may file a request to
review the decision within 90 days from when he/she gets to be aware of the decision.
However, the office that made the original decision, the respondent in the AEI, may
not request a review.

3. Review
A. Request for a review
1) Filing of request for a review

A request for a review shall be filed when the applicant is not satisfied with the decision
of AEI. The request has to be filed to the Job Center that made the original decision.
2) Forwarding of the request for a review

The office that made the original decision must forward the request for a review to the

Adjudication Committee for the Employment Insurance together with their opinion
thereto. The office also has to notify the referee of the fact that a review was
requested for his/her decision by sending a copy of the request to him/her.
3) Documents to accompany with the request for a review

The opinion of the office that made the original decision to be attached to the request
for a review must contain; the grounds and reasons of the original decision, the
decision of AEI, the points raised in the application, and the views of the office
regarding the points and related evidence.
The referee who is notified of the request for a review on his/her decision, must
submit a copy of the decision of AEI and copies of all material referred to in his/her
decision making process.
Appendix
B. Requirements to make a request for a review
1) Parties
The applicant is the person whose rights or interest had been invaded by the decision
of the head of the Job Center who made the original decision. The head of the Job
Center shall be respondent in the review proceedings.

2) Object of the review
The review shall be limited to those cases by a person who objects to the decision of
the Job Center regarding confirmation of acquisition and loss of the insured person’s
status, UB, Childbirth Leave Benefit and Childcare Leave Benefit and whose
application to AEI was dismissed or denied.
3) Time of making the request

The request for a review must be filed within 90 days from the date when the decision
by a referee becomes to be aware of the applicant.
C. Adjudication committee for the employment insurance
Adjudication Committee for the Employment Insurance (the“Review Committee”) is

established to carry out review of the decision made by a referee of AEI. Please see
Book 5 Chapter 1 of this White Book for the details of the Review Committee.
D. Proceedings by the committee
The RC must notice the applicant and the referee of the date and place for hearing of
the review at least 3 days prior to the hearing date. The notice must be in writing. The
notice may be served in person or by registered post. The parties may present their
cases to the RC in writing or by word of mouth.
E. Adjudgment
The RC must make a ruling within 50 days from receipt of the request for a review.
The ruling must be in writing. When a decision is made, the RC must send the
original copy of the ruling to the applicant and the head of local Job Center.
Decisions included are rejection, dismissal, and cancellation.
F. Objection to the decision of the RC
A person who objects the decision by the RC may file an administrative litigation to
the Administrative Court within 90 days from the date of receiving the original copy
of the RC decision.

Administrative litigation must be filed at the Administrative Court (or District Court
where no Administrative Court is established) having jurisdiction over the area where
the office that made the original decision is located.
The Administrative litigation is adjudged by the Administrative Court. Appeals are

heard by the High Court and the Supreme Court in turn.

4. Record of the Application for AEI and the Request for a Review
A. Application for AEI
1) Record of application for AEI

There have been 6,379 applications for AEI and 6,338 decisions were made by AEI
between 1 July 1996 and 31 December 2008. In year 2008, 588 applications were
made and 596 cases(including cases from the previous year) were decided, and 84
cases among them were cancelled.

[Table -1-2] Applications and decisions of adjudication on employment
insurance
Disposal
Carry
Distinction Application Cancellation
Total Rejection Dismissal Withdrawal Over
Cases %
Total 6,379 6,338 1,175 18.5 4,793 214 155 41
1996 64 64 56 87.5 4 3 1 (0)
1997 161 159 94 59.1 60 4 1 (2)
1998 641 604 32 5.3 534 24 14 (39)
1999 758 763 145 19.0 563 36 19 (34)
2000 320 344 75 21.8 233 28 8 (10)
Appendix
2001 306 305 59 19.3 226 10 10 (11)

2002 367 356 113 31.7 226 7 10 (22)
2003 739 728 146 20.0 547 17 18 (33)
2004 607 587 111 18.9 433 19 24 (53)
2005 644 668 78 11.7 563 12 15 29
2006 617 610 101 16.6 479 13 17 36
2007 567 553 81 14.6 438 24 10 49
2008 588 596 84 14.1 487 17 8 41

2) Record of application for AEI sorted by subject
Cases involving objection to the decision regarding the qualification to receive the
benefit were the largest among applications with total number of cases reaching 2,584
(40.5%).
588 applications were made in year 2008. The number of applications sorted by the
subject was as follows:
150 cases (25.5%) regarding the qualification to receive the benefit;
67 cases (11.4%) regarding recognition of unemployment;
85 cases (14.5%) regarding Allowance to Promote Employment;
187 cases (31.8%) regarding receipt of benefit by wrongful means;
42 cases (7.1%) regarding the status of the insured person;
8 cases (1.4%) regarding Childcare Leave Benefit;
17 cases (2.9%) regarding Childbirth Leave Benefit;
32 cases (5.4%) on other causes.
[Table -1-3] Applications sorted by the subject

Job seeking
Qualification allowance Allowance Status
Wrongful Childcare Childbirth
Distinction Total to receive (Recognition to promote as an Other
of receipt Leave Leave
benefit employment insured
unemployment)
Total 6,379 2,584 515 669 1,885 221 37 198 270
1996 64 64 56 87.5 4 3 1 (0)
1997 161 159 94 59.1 60 4 1 (2)
1998 641 604 32 5.3 534 24 14 (39)
1999 758 763 145 19.0 563 36 19 (34)
2000 320 344 75 21.8 233 28 8 (10)
2001 306 305 59 19.3 226 10 10 (11)
2002 367 356 113 31.7 226 7 10 (22)
2003 739 728 146 20.0 547 17 18 (33)
2004 607 587 111 18.9 433 19 24 (53)
2005 644 668 78 11.7 563 12 15 29
2006 617 610 101 16.6 479 13 17 36
2007 567 553 81 14.6 438 24 10 49
2008 588 596 84 14.1 487 17 8 41

3) Evaluation
The number of total application in year 2008 was 588, increased by 3.6% (21 cases)
from 567 cases of the previous year. Cancellation rate in year 2008 was 14.1%,
reduced from 14.6% of the previous year. As to the subject of the application, applications
related to wrongful receipt were 187 cases (31.8%), ranking the top. The number of

applications regarding qualification to receive the benefit, childcare leave benefit,

childbirth leave benefit has reduced. The number of applications regarding recognition of
unemployment and regarding allowance to promote employment has increased.
B. Record of request for a review

1) Record of request for a review and decision on review
Total 1,263 requests for a review were made and 1,258 decisions on review were
made from 1 July 1996 to 31 December 2008. In year 2008, 108 requests were made
and 120 cases(including carried over cases) were adjudged and, 20 cases (16.6%)
among these were adjudged to cancel.

[Table -1-4] Annual record of request and adjudgment on review
Disposal
Carry
Distinction Request Cancellation
Total Rejection Dismissal Withdrawal over
Cases %
Total 1,263 1,257 312 24.8 892 38 15 5

1996 1 0 0 0 0 0 0 (1)
1997 15 13 4 30.8 7 2 0 (3)
1998 188 163 15 9.2 138 10 0 (28)
1999 206 219 58 26.5 149 8 4 (15)
2000 90 104 33 31.7 64 5 2 (1)
Appendix
2001 70 62 22 35.5 40 0 0 (9)

2002 77 80 13 16.3 64 3 0 (6)
2003 144 142 34 23.9 104 0\ 4 (8)
2004 71 72 35 48.6 34 1 2 (7)
2005 108 111 31 27.9 77 2 1 4
2006 101 92 26 28.3 64 2 13
2007 84 79 21 26.6 57 0 1 18
2008 108 120 20 16.6 94 5 1 5

2) Record of request for review sorted by contents
The request relating to the qualification to receive benefit were 493 cases (39.0%),
ranked the top. 108 requests for review were made in year 2008. The number of
requests sorted by the subject was as follows:
27 cases (25.0%) regarding the qualification to receive the benefit;
4 cases (3.7%) regarding recognition of unemployment;
17 cases (15.7%) regarding Allowance to Promote Employment;
31 cases (28.7%) regarding receipt of benefit by wrongful means;
20 cases (18.5%) regarding the status of the insured person;
4 cases (3.7%) regarding Childbirth Leave Benefit;
5 cases (4.6%) on other causes.
[Table -1-5] Annual record of request for review sorted by subject
Qualification Job seeking Allowance to Status

allowance Wrongful Childcare Childbirth
Distinction Total to receive promote as an Other
(Recognition of receipt leave leave
benefit unemployment) employment insured
Total 1,263 493 58 104 436 52 5 14 101

1996 1 1 - - - - - - -
1997 15 6 1 1 6 1 - - -
1998 188 162 7 0 13 2 - - 4
1999 206 103 3 10 82 2 - - 6
2000 90 21 9 4 49 2 - - 5
2001 70 15 3 9 40 3 - - -
2002 77 17 2 7 44 4 1 - 2
2003 144 27 12 12 23 3 4 - 63
2004 71 34 2 9 19 1 - 1 5
2005 108 34 2 14 48 4 - 2 4
2006 101 25 6 12 52 3 - 1 2
2007 84 21 7 9 29 7 - 6 5
2008 108 27 4 17 31 20 - 4 5
3) Evaluation
The number of total request in year 2008 was 108, increased by 28.5% (24 cases)
from 84 cases of the previous year. Cancellation rate in year 2008 was 16.6%,
reduced from 26.6% of the previous year.

As to the subject of the application, applications related to wrongful receipt (31 cases)
ranking the top, followed by the application regarding qualification to receive the
benefit (27 cases). The number of applications regarding Job Seeking Benefit
(recognition of unemployment) reduced, but applications relating to status of insured

person and allowance to promote employment have increased.

5. Consolidating Referees of AEI
The referees of AEI are employed by six local labor departments respectively. There
have been questions as to the abilities of the referees that led to criticisms of the
correctness and reliability of their decisions. Further, the number of request for review
and cancellation differed from region to region. On the other hand, the administration
of the Adjudication Committee was taken care of by the Employment Insurance
Policy Division, which is responsible for designing and implementing the
Employment Insurance policies. As a result, the fairness of the review was constantly

challenged. As a measure to address the above problems, the Referees of AEI have
been consolidated and managed by the head office of the Labor Department from 23
October 2006 upon amendment to the Employment Insurance Act and the
Employment Insurance Regulations in December 2005.
Appendix


APPENDIX
01 Statistics on Employment Insurance

Plan of Korea
02 Projects & Project Managers of

(as of Aug. 2009)
Statistics on Employment Insurance
Plan of Korea
[Table 1] Record of the insured by employment insurance

(Unit : %)
Year 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008
Number at the
6,054,479 6,747,263 6,908,888 7,171,277 7,203,347 7,576,856 8,063,797 8,536,966 9,063,301 9,385,239
end of year
(Increase ratio
compared to the (14.9) (11.4) (2.4) (3.8) (0.4) (5.2) (6.4) (5.9) (6.2) (3.6)
previous year)
Acquisition 3,330,353 3,695,723 3,435,154 3,692,771 3,449,449 3,764,995 4,264,292 4,429,144 4,642,261 4,838,866
Loss 2,499,662 2,981,558 3,234,745 3,404,669 3,394,502 3,364,005 3,720,733 3,894,942 4,061,173 4,453,152
※ The statistics on the insured people counted constant workers only. Daily workers (workers with less than 1
month employment period) are excluded because of the problem related to the timeliness of the report on the
details of works in retrospect.
[Table 2] Trend in the sex and age of the insured

(Unit : %)
Year Increase
2002 2003 2004 2005 2006 2007 2008 rate
100 100 100 100 100 100 100
Total 3.6
(7,171,277) (7,203,347) (7,576,856) (8,063,797) (8,536,966) (9,063,301) (9,385,239)
Man 67.4 66.8 66.3 65.8 65.3 64.6 64.0 2.7
Woman 32.6 33.2 33.7 34.2 34.7 35.4 36.0 5.1
Less than 20 1.4 1.1 0.9 0.8 0.6 0.6 0.5 -10.2
20~29 31.5 30.8 29.4 28.2 26.9 25.8 24.5 -1.5
30~39 33.8 34.2 34.2 34.3 33.7 33.6 32.7 1.4
40~49 22.3 22.6 22.8 23.2 23.4 23.9 24.5 7.0
50~59 9.7 9.9 10.2 10.8 11.3 11.9 12.6 10.3
Over 60 1.4 1.4 2.5 2.7 4.2 4.8 5.2 13.1
※ Increase rates are in comparison with the number of total insured people in the previous year. The figures in ( )
represent the number of total insured people.

[Table 3] Trend in the ratio of the insured in different industries
(Unit : %)
Distinction 2006 2007 Distinction 2008
100 100 100

Total Total
(8,536,966) (9,063,301) (9,385,239)

Agriculture 0.3 0.3 Agriculture, Forestry, Fishery 0.4
Mining 0.2

Fishery 0.1 0.1
Manufacturing 31.2
Mining 0.2 0.2 Electricity, Gas, and running water 0.7
Sewage, Garbage disposal 0.5

Manufacturing 33.8 32.8
Construction 6.9
Electricity, Gas, and Sales 10.5
0.7 0.7
running water Transportation 5.9
Construction 7.1 7.0 Food&accommodation 2.4
Publishing, movie, broadcasting

Sales 10.5 10.5
& communication, Information 5.3

Food&accommodation 2.3 2.4 service
Finance & insurance 4.6

Transportation 6.3 6.2
Real estate & lease 3.0
Communication 1.0 0.9
Specialized science &
5.4
technology service
Finance&insurance 4.7 4.6
Business facility management
Real estate& lease 3.1 3.1 7.5
service
Business services 14.4 15.1 public, administration,

2.0
national defence
Education service 2.8 2.9
Education service 3.0
Health & social welfare 6.0 6.5 Health & social welfare 7.2
Art, Sports 0.8

Entertainment, Culture,
1.3 1.3
Appendix
sports Associations, Organizations,

2.6
Repair
Other public individual
3.4 3.4 Home employment 0.0
Service
International, foreign
0.1
Other industry 2.0 2.0 institution
※ The figures in ( ) represent the number of total insured people.

※ As the data for year 2008 are based on the 9th amendment to the standard industry classification,
discontinuance in terms of time may occur.

[Table 4] Trend of the insured by size of business
(unit : number of employees, %)
Year Increase
2002 2003 2004 2005 2006 2007 2008 rate
100 100 100 100 100 100 100
Total 3.6
(7,171,277) (7,203,347) (7,576,856) (8,063,797) (8,536,966) (9,063,301) (9,385,239)
Less than 5 16.9 14.7 16.9 16.0 15.9 16.0 15.9 2.7
5~9 10.1 10.2 10.3 10.5 10.3 10.4 10.4 3.7
10 ~ 29 15.7 16.2 16.1 16.8 16.5 16.8 16.8 3.7
30 ~ 99 16.4 16.6 16.0 16.3 16.1 16.2 16.2 3.8
100 ~ 299 14.6 14.6 14.1 14.4 14.3 13.9 13.9 3.4
300 ~ 999 11.1 10.9 10.7 11.0 10.4 10.1 10.5 7.5
Over 1,000 15.1 16.7 15.8 15.1 16.5 16.6 16.3 1.7
※ Increase rates are in comparison with the number of total insured people in the previous year.
[Table 5] Record of income and expenditure of the fund for year 2008
(unit: million won)
Income Expenditure
Total 9,022,381 계 9,022,381
Job security. Job capability

Employment insurance premium 3,968,503 1,801,456
Development program
Penalty for late payment, etc 62,710 Unemployment benefit 3,174,060
Additions 4,642 Administration expenses 100,148
Interest 372,286 leeway investment 3,940,807
Other income 60 Carry over to the next year 5,910
Loan collection 87,444
Collection of deposit 4,499,300
Carried over from the previous year 17,218
Transfer from the general account 10,218

Projects & Project Managers of
(as of Aug.2009)

Project Manager Tel e-mail address
(82-2-2110-XXXX)
Kim, Ho-hyun 7142 h3kim@hanmail.net

Subsidy for keeping jobs
Jun, Yun-jin 7146 whiteska@daum.net
〃〃〃
Subsidy to encourage re-employment
〃〃〃
〃〃〃
Subsidy to encourage job change
〃〃〃
〃〃〃
Subsidy to encourage new employment

〃〃〃
Subsidy to SMEs changing into shift work plan Jo, Won-shik 7390 herennow77@molab.go.kr
Kim, Ho-hyun 7142 h3kim@hanmail.net

Subsidy to SMEs for improving the work environment
Jun, Yun-jin 7146 whiteska@daum.net
Subsidy to encourage use of workers with 〃〃〃
special knowledge or skill 〃〃〃
〃〃〃
Subsidy to SMEs for entering into a new business area
〃〃〃
〃〃〃
Subsidy for changing into shift work plan
〃〃〃
Subsidy to encourage employment of the people completing 〃〃〃
the training for middle and upper middle aged workers 〃〃〃
Appendix
〃〃〃
Subsidy to assist job change
〃〃〃
Jung, Jin-woo 7267 jjjw35@hanmail.net
Aid for JCDTs by business owners
Min, Gwang-jei 7263 redzone71@nate.com
Bae, Sang-hoon 7265 psh654@hanmail.net
Aid for workers capability development
Ko, Yeon-ju 7262 frts25@molab.go.kr

Project Manager Tel e-mail address
(82-2-2110-XXXX)
Kim, Tae-ryoung 8207 knabi1@mail.molab.go.kr

The training for the unemployed people to change jobs
Ro, Tae-gu 7270 rtg90@molab.go.kr
Choi, Jung-hoi 7275 choijunghoi@yahoo.co.kr
Training for priority occupational areas
Lee, Chang-kyou 7272 lck100@molab.go.kr
Jung, Jin-woo 7267 jjjw35@hanmail.net
SMEs job training consortium program
Min, Gwang-jei 7263 redzone71@nate.com
〃〃〃
Assisting Study Groups in SMEs
〃〃〃
〃〃〃
SME core job capability development
〃〃〃
Park, Yeong-taik 8220 lsa1201@molab.go.kr
Subsidy for qualification test fee
You, Gwang-ok 7280 captain@molab.go.kr
Hwang, Sun-burm 7145 hsunbum@molab.go.kr
Unemployment Benefit
Yang, Dong-chul 7139 y9889@molab.go.kr
〃〃〃
Early Re-employment Allowance
〃〃〃
Subsidy for continuous employment after pregnancy Choi, Sang-un 7294 upluck@molab.go.kr
and childbirth Lim, Se-young 7296 sylis@molab.go.kr
Subsidy for childbirth and other leaves and Subsidy for 〃〃〃

employing substitute workers 〃〃〃
Kwak, Hee-kyung 7293 lemonade76@molab.go.kr
Subsidy to wages of the childcare teachers
Park, Tae-young 7317 tyoung@hanmail.net
Loan or subsidy of the costs to establish childcare facilities 〃〃〃

in work places 〃〃〃
Choi, Sang-un 7294 upluck@molab.go.kr
Childbirth Leave Benefit
Lim, Se-young 7296 sylis@molab.go.kr
〃〃〃
Childcare Leave Benefit
〃〃〃
Subsidy for Promotion of Employment of the Aged Park, Chung-kon 7312 captain2222@molab.go.kr
Yun, Young-kwi 7308 y2k324@molab.go.kr

Allowance to supplement the peak wage plan
Shin, Yong-beom 7318 setup73@molab.go.kr

▶ Planned by : Yi, Sung-ki

(Director-General of International Cooperation Bureau)
▶ Translated by: Kwon, Tae-wook
(Barrister and Solicitor of the High Court of New Zealand)*
▶ Edited by: Park, Hyun-jung
▶ Financed by: Employment Insurance Policy Division
▶ Supervised and Published by
- Chang, Keun-sop
(Director of International Cooperation Division)
- Park, Young
(Deputy Director of International Cooperation Division)
- Hwang, Jung-ho
(Assistant Director of International Cooperation Division)
* Barrister and Solicitor of the High Court of New Zealand

BA (Seoul National University), LLB (The University of Auckland)
E-mail: twkwon@hotmail.com

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Electronic version of the paper can be downloaded at the homepage of the

I expect this book can greatly enhance the international community's

Deputy Minister for Planning and Cooperation Office

SECTIONⅡ. SUMMARY OF THE EMPLOYMENT

Chapter 5. AID TO CONSTRUCTION WORKERS ……………………… 85

Chapter 6. AID TO CHILDCARE FACILITIES IN WORK PLACES …… 86

Chapter 7. IMPROVEMENTS MADE TO THE JOB SECURITY

SECTIONⅡ. JOB CAPABILITY DEVELOPMENT PROGRAMS ………… 95

Chapter 1. OVERVIEW ……………………………………………………… 95

Chapter 2. AID TO THE JCDP BY THE BUSINESS OWNERS ………… 98

Chapter 3. AID TO SMALL AND MEDIUM SIZE ENTERPRISES ……… 105

Chapter 4. ASSISTANCE TO THE EMPLOYED WORKERS …………… 108

SECTIONⅢ. UNEMPLOYMENT BENEFIT ……………………………… 122

4. Payment Amount ……………………………………………………… 130

Chapter 3. SICKNESS BENEFIT ………………………………………… 132

Chapter 6. RESTRICTION ON PAYMENT AND ORDER TO REPAY

Chapter 7. UNEMPLOYMENT BENEFIT(“UB”) PAYMENT

SECTIONⅣ. PROTECTION OF MATERNITY AND SUPPORTING

SECTIONⅤ. ADJUDICATION ON EMPLOYMENT INSURANCE …… 157

Employment Insurance White Paper 2009

Introduction to the Employment Insurance

Section The Purpose and Function of the

Section Summary of the Employment

Employment Insurance “EI”

Traditional Unemployment Insurance “UI”

Job Security Programs “

Job Capability Development Program “JCDP”

Employment Insurance White Paper 2009 ■ 12

PART 1 _ Introduction to the Employment Insurance

Plan of the Republic of Korea

PART 2 _ Employment Insurance Plan

policy of every country in the world.

On the other hand, unemployment in the capitalist economy is inevitable because

13 ■ Ministry of Labor Republic of Korea

Provision of unemployment benefit under the unemployment insurance alone is not

Employment Insurance White Paper 2009 ■ 14

PART 1 _ Introduction to the Employment Insurance

Employment Insurance “ ( EI”) comprises of Job Security Program “( JSP”), Job

PART 2 _ Employment Insurance Plan

their work performance capability.

Unemployment Benefit “UB”( ) is aimed at stabilizing the livelihood of the workers

15 ■ Ministry of Labor Republic of Korea

When the Employment Insurance Act “EIA”

Employment Insurance White Paper 2009 ■ 16

PART 1 _ Introduction to the Employment Insurance

Plan of the Republic of Korea

2. Workers Excluded From the Program

PART 2 _ Employment Insurance Plan

A. Excluded workers at ordinary work places

B. Workers in particular job categories are excluded

17 ■ Ministry of Labor Republic of Korea

EI does not apply to foreigners in principle. However, it applies to the followings:

Employment Insurance White Paper 2009 ■ 18

The EI is managed by Employment Policy Division “

PART 1 _ Introduction to the Employment Insurance

Plan of the Republic of Korea

PART 2 _ Employment Insurance Plan

Korea Employment Information Center “

Collection, analysis, and dissemination of information on the labor market;

Payment of benefits and allowances including UB;

19 ■ Ministry of Labor Republic of Korea

Chapter 4 JOB STABILIZATION PROGRAMS

Employment Insurance White Paper 2009 ■ 20