Towards Better Social and Employment Security in Korea by OECD

Author:OECD
Language: eng
Format: epub
Tags: Employment
ISBN: 9789264288256
Publisher: OECD Publishing
Published: 2018-03-13T16:00:00+00:00

Notes

← 1. Incapacity benefits include sickness benefits, disability benefits and allowances and workers’ compensation payments. Last-resort benefits are means-tested payments which people can receive in most countries if they cannot generate enough income to assure a decent living through work and/or social benefits.

← 2. The estimated share is 9.6% for the period 2007-2014, obtained by classifying all those people as unemployment benefit recipients who have received unemployment benefit according to either the individual data file of KLIPS or the work history data file. The estimate should be treated with caution. While KLIPS is a high-quality panel survey often used for international comparisons, it is rarely used in Korea for analyses related to unemployment benefits because of possible sampling errors (sampling criteria include age and household size, for instance, but not benefit receipt). However, population survey data generally underestimate benefit receipt, not only in Korea. Comparing KLIPS results with administrative data records suggests over the period 2007-2014 KLIPS underestimates the number of unemployed people as well as the number of EI recipients by around 20%. This is a considerable degree of underestimation but not unusual.

← 3. Going back in time by another four or five years, the total recipiency number was only around 1.5 million because EITC and ESPP were only introduced in 2008 and 2009, respectively, and EI recipiency was around half a million lower before the global financial crisis in 2008/09.

← 4. To receive unemployment benefits, a self-employed person must sign up for EI within one year after the business opening date specified on the business registration certificate. There are seven insurance premium levels depending on the announced standard remuneration (Level 1: KRW 1 540 000, Level 7: KRW 2 690 000 in 2016), as specified by the self-employed person. The premium rate is 2.25% of the selected standard remuneration. The person must be insured for at least one year to be eligible for job-seeking benefits. In case of involuntary business closure, he/she can receive unemployment benefits amounting to 50% of the standard remuneration for a period of 90 to 180 days depending on the contribution period.

← 5. People who are employed or start up their own business after the age of 65 are not entitled to EI benefits but can still participate in employment security and vocational skills development programmes. Also not covered by Employment Insurance are public officials, private school teachers and special post office workers who, however, face a low unemployment risk and have their own occupational systems

← 6. In 2015, three years after the introduction of the opt-in option, only 1 290 self-employed received an EI benefit. No data is available on the number of self-employed who have opted into the system.

← 7. The Duru-Nuri programmes subsidises EI premiums but also premiums to the national pension scheme. The number of recipients of the latter is larger (over 900 000 workers in 2016 and over 490 000 employers) because not all of these workers fall under the EI programme. Health insurance contributions are not currently subsidised although this possibility is discussed.

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