"If Under Personal Rehabilitation, Concerns About Disadvantages
Companies Worry About Rising Cost Burdens"
If the government shifts the eligibility criteria for employment insurance from "working hours" to "income," industries such as IT, logistics, private academies, and restaurants are expected to be directly affected. In particular, there are concerns about increased cost burdens for small business owners, as well as the possibility of a rise in disputes over "employee status."
On July 7, the Ministry of Employment and Labor announced that it would give advance notice of legislation for the proposed amendments to the Employment Insurance Act and the Employment and Industrial Accident Insurance Premium Collection Act until August 18. The proposed amendments include changing the employment insurance eligibility standard from "working at least 15 hours per week" to an "income-based" criterion, and allowing individuals to enroll in employment insurance if their combined income from multiple workplaces exceeds a certain threshold, upon their application.
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If the amendments are implemented, ultra-short-term workers who work less than 15 hours per week will be included as eligible for employment insurance. Small business owners who hire part-time workers will also be required to pay 0.9% of monthly wages. As of May 2025, there are 1,763,000 ultra-short-term workers working less than 15 hours per week. A lawyer at a major law firm commented, "From a social security perspective, this may be desirable, but as the number of employment insurance subscribers increases, companies will inevitably feel a cost burden," adding, "If the scope is expanded to include ultra-short-term workers, it will eventually affect not only small business owners but also large companies."
The impact of the amendments is expected to be felt directly in certain industries with high numbers of ultra-short-term workers. Currently, the employment insurance system determines eligibility on a workplace-by-workplace basis. If a worker works 10 hours per week at one workplace and 5 hours at another, they are not eligible for employment insurance. As a result, in industries such as IT, logistics, private academies, and restaurants, it has become customary to contract for less than 15 hours per week to avoid employment insurance eligibility. Choi Hyunjun, a lawyer at Daeryuk Aju Law Firm (age 38, 5th bar exam), said, "The amendments are not targeting specific industries, but rather reflect changes in the work environment, such as the rise of 'multi-jobbers' who work at multiple workplaces since the COVID-19 pandemic," adding, "It is expected that employment insurance coverage will expand in industries like IT, where such work arrangements are relatively common."
There is analysis that, if the amendments are implemented as announced, legal disputes over "employee status" may increase. Previously, through the 2021 and 2022 amendments to the Employment Insurance Act, 19 specific types of special-type workers (special employment types) and platform workers became eligible for insurance if they earned at least 800,000 won per month. However, as blind spots are addressed for those not included in these occupations or who were omitted despite being eligible under the law, the issue of employee status remains a key point of contention.
Lee Dongmyung, a lawyer at Choi & Lee Law Firm (age 36, 8th bar exam), explained, "Among freelancers and platform workers who have been paid business income after a 3.3% withholding tax deduction, those who can be recognized as de facto employees will have more to gain by being recognized as employees, so disputes over employee status will increase." He added, "We are frequently receiving inquiries about whether existing members of companies who are not enrolled in employment insurance need to be enrolled, and how to prepare for the recognition of employee status."
Choi Youngjae, a lawyer at DLG Law Firm (age 41, 3rd bar exam), said, "Some riders and freelancers who are undergoing personal rehabilitation or wish to avoid income disclosure do not want to enroll in employment insurance, fearing disadvantages if their income is officially revealed," adding, "While expanding employment insurance coverage is significant in protecting those previously outside the system, it may not be a welcome change for everyone." Choi also noted, "If these amendments are implemented, they could also affect the issue of workers working less than 15 hours per week being excluded from other labor law systems, such as the Labor Standards Act, in the future."
The government plans to collect opinions from experts for 40 days and then submit the amendments to the National Assembly in October.
Seo Hayeon, Legal Times Reporter
※This article is based on content supplied by Law Times.
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