Unemployment Benefits Reduced by Up to 50% for Repeated Claims

Government to Re-Push Amendment of Related Laws

[Image source=Yonhap News]

The revision of the law to reduce unemployment benefits by up to 50% for recipients who repeatedly receive benefits is being re-promoted.

The Ministry of Employment and Labor announced on the 16th that eight related legislative amendments, including the Employment Insurance Act and the Act on Collection of Employment and Industrial Accident Insurance Premiums, were reviewed and approved at the Cabinet meeting held on the same day.

First, the partial amendment to the Employment Insurance Act includes reducing the benefit amount for repeat recipients who have received job-seeking benefits three or more times within five years. The detailed reduction criteria will be delegated to the enforcement decree, but the previous amendment proposed reductions of 10% for three times, 25% for four times, 40% for five times, and 50% for six or more times within five years.

Additionally, a basis was established to extend the waiting period to receive job-seeking benefits again from the existing 7 days up to a maximum of 4 weeks.

The Ministry explained that supplementary measures have been prepared to exclude vulnerable workers in the labor market, such as low-wage workers and daily workers, from the count of repeated benefit receipts, and that the number of repeated receipts will be calculated only for cases after the law takes effect.

Also approved was the Act on Collection of Employment and Industrial Accident Insurance Premiums, which allows employers to impose additional unemployment insurance premiums up to 40% for workplaces with a significantly high number of short-term employees.

This aims to prevent the practice of abusing the job-seeking benefit system by contracting short-term jobs. The target workplaces are those with a high proportion of short-term employees among job-seeking benefit recipients who changed jobs in the past three years and where the ratio of paid job-seeking benefits to the insurance premiums imposed is high.

These amendments were jointly proposed by the government and ruling and opposition lawmakers in the previous administration but were discarded without progress in the National Assembly amid opposition from labor groups.

Labor groups argue that the government is stigmatizing repeated benefit claims due to employment insecurity as fraudulent claims and insist that ensuring employment stability for youth and vulnerable workers should be prioritized.

Lee Jeong-sik, Minister of Employment and Labor, stated, "We will actively support rational discussions in the National Assembly so that the job-seeking benefit system, a core employment safety net, faithfully fulfills its original function of supporting reemployment, enhances fairness among insured persons, and strongly protects vulnerable workers."

Meanwhile, at the Cabinet meeting on the same day, an amendment to the Certified Labor Consultant Act was also approved, allowing minors to take the Certified Labor Consultant exam in advance and requiring prior notification of investigation logs and contents of Certified Labor Consultant offices.

Furthermore, to revitalize the adult guardianship system and strengthen the protection of the basic rights of wards, the disqualification clause of 'limited guardianship' was removed from the qualifications for acquisition or committee appointments in three laws: the Employment Insurance Act, the Lifelong Vocational Ability Development Act, and the Industrial Accident Compensation Insurance Act.