Korean Job Discussion Forums

[rich45]

Hi,

I know this topic has been covered quite extensively already (I've literally just spent the last 3 hours reading about it!!), but there still doesn't seem to be a definitive verdict.

I queried the 3.3% tax rate with my recruiter, but he said that it was correct and gave me a link to the National Tax Service to prove his point - sure enough it did say 3.3%, but under the Independent Contractor column as opposed to the Employee column.

I was on the verge of sending my recruiter an arsey email as I read so many times that it is illegal to be an Independent Contractor on an E2 Visa, but then somebody pointed out that nobody has ever proved this to be accurate on these boards.

In the end I decided to just email him asking for his take on the differences between an Employee vs an Independent Contractor...it will be interesting to see what he has to say.

My contract has no mention of Pension either, which I'm sure is relevant to being an Independent Contractor, but I'm not sure how at this stage...can somebody enlighten me? And/or give me a definite answer about whether an independent Contractor is indeed legal on an E2 Visa?

Thanks a lot,

Rich

[cruisemonkey]

It's perfectly legal.

However, if the employee is an independent contractor, there is a different tax rate and the employer is not obligated to contribute to pension or medical insurance.

[Zaria32]

I'm not sure you're right CruiseMonkey. It's my understanding that an E-2 visa is ONLY for a "full-time employee." If that is correct then an E-2 visa holder is always being overcharged taxes as 3.3%. But I'm not an expert on this, let's apply to ttompatz for a definitive answer...

[Join Me]

An E2 Visa holder is an "employee." If we could be "contractors" each and every one of us would have the word "contractor" in our contract instead of "employee." "Contractor" status is in the employer's best interest financially. If we could be classified in this way without potentially causing the employer problems, they would all do it without question. Don't sign any contract that states you are a "contractor."

[ttompatz]

Under the labor standards act our jobs are defined as employees.
Under the immigration control act we are classed as SPONSORED employees.

An E2 holder cannot LEGALLY be classed as an independent contractor.

A contractor sets their time and conditions of work.
They are given a job to do and complete said task within the time and budget constraints of the agreement.
Built the house for 100 million won and be done in 30 days. They can choose to work four 10 hour days or five 8 hour days or two twenty hours days each week to complete the task. They can choose when and how to work. They are independent.

IF the employer dictates how you work, the time, and conditions of work you are an employee. You are DEPENDANT. You are an employee.

It is possible for an F2/F4/F5 visa holder to be independent but it is NOT possible under the terms of their visa for an E1/E2 to be independent of their sponsor.
The dependency makes it an employer/employee relationship.

IF you have the time and money you can feel free to fight this one but the people you are fighting against have deeper pockets and it will be an uphill battle.

Any employer (including places like CDI) who classes you (as an E1/E2) as a contractor is a liar and a thief and you should look to/move to someone else.

.

[cruisemonkey]

ttompatz,

If it's not legal for an E-2 to be an independent contractor, how do the school districts that have elementary after school programmes with 'independent', E-2 visa holders get away with it?

[ttompatz]

[Join Me]

[I-am-me]

[Join Me]

[Voyeur]

Question is moot.

It really doesn't matter from our end.

But if a job wants to make you a contractor and doesn't provide more up front cash to compensate for lack of benefits then it is a crappy offer. If it does, well then you need to run the numbers and decide if the extra $$$ makes up for the loss of benefits.

[quilter]

Ttompatz,

Do you have a link to the info you were talking about? I'd like to show it to the boss.

[rich45]

Thanks for the replies!

For the mostpart I understand the independent contractor issue now, and usually such an issue would make me run in the opposite direction, but isn't this issue so commonplace amongst dodgy hagwons that I'll simply have to bite the bullet?

Don't most hagwons operate like this?

I only plan on spending one year in South Korea...should I be expected to just get on with it? It doesn't seem right to do so, but the only way that I seem to be losing out is by paying a bit more in tax (which isn't much), and not contributing to a Pension (I'm British so I wouldn't be able to claim it back anyway...right?). Also Medical Insurance is included on my contract...

Rich

[Join Me]

If you don't get the pension refund and your boss is paying your healthcare, you are probably right that it isn't worth getting into a knock down brawl with the owner over.

[ttompatz]