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big_fella1
Joined: 08 Dec 2005
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 Posted: Tue Apr 16, 2013 6:49 pm Post subject: Re: Hiring E2's as independent contractors is a scam |
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| Weigookin74 wrote: |
| big_fella1 wrote: |
Hi guys, it is up to you whether you take a job as an independent contractor but know that if you work in one place for a fixed time, with a boss you are an employee not an independent contractor. Source: http://www.thekoreanlawblog.com/2011/06/independent-contractors-and-obligations.html
You can read an academic article about it here:
http://www.jstor.org/discover/10.2307/40377726?uid=3738392&uid=2&uid=4&sid=21102037833831
It's worth noting since this was written the exemptions for employer with less than 5 employees have been removed. The only legal way not to pay pension, health insurance, and retirement allowance is if you are family. Although South Africans don't have to get pension.
Getting the various Korean ministries involved to actually investigate this may be difficult so I recommend the following:
1. Keep a diary noting any meetings your boss has with you, what they said and your working hours;
2. Keep any documentation your employer gives you;
3. Know your rights and clearly state what you want;
4. Make it clear that you will be in Korea for quite a while longer. A university professor wrongly dismissed took one year to get a ruling in his favour. He was paid for the year he couldn't work.
I cannot promise that you will be paid the social security you are owed if you fight it, thus it is better to find a job with a company that follows the law.
If you must take a job as an independent contractor, you can seek reimbursement when you finish your contract. I cannot guarantee that you will be successful, but I can guarantee you won't be if you don't try.
A further note is if you accept an IC agreement with an E2 visa, you are breaking immigration law as well, an E2 is an employment visa. Luckily for you immigration does not care to enforce this. |
But, it still happens. The government allows it and never does anything about it when it's reported. So, it's not really illegal under that definition. If it were, the government would get off their lazy @ss and stop it but they don't. Anyhow, if you do take an IC position make sure it pays enough to cover housing, buy medical, contribute to your pension, and pay the appropriate tax rate. I had seen CDI offering 30,000 won an hour about a year ago on an ad. Doing the math, it seemed fair. If you paid the fees (taxes, pension, etc) yourself, you still had slightly more than salaried employees. If you were only here for a year or two and risked not paying those things, you made more money in your pocket. Never worked for them. I've heard both good and bad.
Moral of the story, if you agree to the IC, you should be gauranteed a minimum of hours and get at least 30,000 and hour with pre paid flight or re-imbursement, if you trust the company.
Don't do an IC for 20,000 an hour. An offer like that, tell them to shove it you know where. |
I understand where you're coming from, although immigration does go around and fine the D8s that should be on D7s every 2-3 years, as many companies find it easier to give a guy 100 million and a business plan than to go through the procedures to get a D7. It's unlikely but immigration could do the same to E2s.
Definately you should do what is iin your financial interests, but I get upset with both Koreans and Expats being conned into IC status to benefit the company. Its common as agreed by I think all of us here arguing this, but that doesn't make it right.
w30k an hour seems a little low but that's my view as an F5 with a family who would lose a lot of benefits if I wasn't an employee such as checkcard and credit card spending deductions, self education deductions, and deductions for my dependent family. Of course I recognise some people are better off as ICs and don't give 2 hoots about the legality, but in my experience IC agreements usually favour the employer. CDI was an exception, but even they were taken to the labour board by some disgruntled employees, despite the fact they had the best E2 IC conditions in Korea.
The scamming on the NHIC one I can't abide by though Korea is too dangerous to go a day without covverage.
The problem for newbies is they cannot get coverage until they've been in the country for 3 months. Source: http://www.nhic.or.kr/static/html/wbd/g/a/wbdga0703_01.html
IC agreements are illegal but half of the countries employees are on them and it will be the Koreans that stop this practice.
If you leave the safety of your own country to come to a job on 2.1 million as an IC paying the airfare upfront for an unknown hagwon you are an idiot who needs protection from yourself.
Perhaps I must give ontheway some credit I may have appeared to be saying come and sue them later, the best response is don't come.
But if you do get forced into one of these contracts you will find the labour board very pro employee, and I have checked with several labour counsellors, they don't care what your contract says, they care what your work arrangements are/were. The health insurance office will be on your side. The pension office is lazy and will make you pay the whole lot first before they chase your employer and the National Tax Service may pay you a reward as a lot of the hagwons I'm referring to here forget to remit tax they deduct to them. |
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Weigookin74
Joined: 26 Oct 2009
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| Posted: Tue Apr 16, 2013 8:24 pm Post subject: Re: Hiring E2's as independent contractors is a scam |
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| big_fella1 wrote: |
| Weigookin74 wrote: |
| big_fella1 wrote: |
Hi guys, it is up to you whether you take a job as an independent contractor but know that if you work in one place for a fixed time, with a boss you are an employee not an independent contractor. Source: http://www.thekoreanlawblog.com/2011/06/independent-contractors-and-obligations.html
You can read an academic article about it here:
http://www.jstor.org/discover/10.2307/40377726?uid=3738392&uid=2&uid=4&sid=21102037833831
It's worth noting since this was written the exemptions for employer with less than 5 employees have been removed. The only legal way not to pay pension, health insurance, and retirement allowance is if you are family. Although South Africans don't have to get pension.
Getting the various Korean ministries involved to actually investigate this may be difficult so I recommend the following:
1. Keep a diary noting any meetings your boss has with you, what they said and your working hours;
2. Keep any documentation your employer gives you;
3. Know your rights and clearly state what you want;
4. Make it clear that you will be in Korea for quite a while longer. A university professor wrongly dismissed took one year to get a ruling in his favour. He was paid for the year he couldn't work.
I cannot promise that you will be paid the social security you are owed if you fight it, thus it is better to find a job with a company that follows the law.
If you must take a job as an independent contractor, you can seek reimbursement when you finish your contract. I cannot guarantee that you will be successful, but I can guarantee you won't be if you don't try.
A further note is if you accept an IC agreement with an E2 visa, you are breaking immigration law as well, an E2 is an employment visa. Luckily for you immigration does not care to enforce this. |
But, it still happens. The government allows it and never does anything about it when it's reported. So, it's not really illegal under that definition. If it were, the government would get off their lazy @ss and stop it but they don't. Anyhow, if you do take an IC position make sure it pays enough to cover housing, buy medical, contribute to your pension, and pay the appropriate tax rate. I had seen CDI offering 30,000 won an hour about a year ago on an ad. Doing the math, it seemed fair. If you paid the fees (taxes, pension, etc) yourself, you still had slightly more than salaried employees. If you were only here for a year or two and risked not paying those things, you made more money in your pocket. Never worked for them. I've heard both good and bad.
Moral of the story, if you agree to the IC, you should be gauranteed a minimum of hours and get at least 30,000 and hour with pre paid flight or re-imbursement, if you trust the company.
Don't do an IC for 20,000 an hour. An offer like that, tell them to shove it you know where. |
I understand where you're coming from, although immigration does go around and fine the D8s that should be on D7s every 2-3 years, as many companies find it easier to give a guy 100 million and a business plan than to go through the procedures to get a D7. It's unlikely but immigration could do the same to E2s.
Definately you should do what is iin your financial interests, but I get upset with both Koreans and Expats being conned into IC status to benefit the company. Its common as agreed by I think all of us here arguing this, but that doesn't make it right.
w30k an hour seems a little low but that's my view as an F5 with a family who would lose a lot of benefits if I wasn't an employee such as checkcard and credit card spending deductions, self education deductions, and deductions for my dependent family. Of course I recognise some people are better off as ICs and don't give 2 hoots about the legality, but in my experience IC agreements usually favour the employer. CDI was an exception, but even they were taken to the labour board by some disgruntled employees, despite the fact they had the best E2 IC conditions in Korea.
The scamming on the NHIC one I can't abide by though Korea is too dangerous to go a day without covverage.
The problem for newbies is they cannot get coverage until they've been in the country for 3 months. Source: http://www.nhic.or.kr/static/html/wbd/g/a/wbdga0703_01.html
IC agreements are illegal but half of the countries employees are on them and it will be the Koreans that stop this practice.
If you leave the safety of your own country to come to a job on 2.1 million as an IC paying the airfare upfront for an unknown hagwon you are an idiot who needs protection from yourself.
Perhaps I must give ontheway some credit I may have appeared to be saying come and sue them later, the best response is don't come.
But if you do get forced into one of these contracts you will find the labour board very pro employee, and I have checked with several labour counsellors, they don't care what your contract says, they care what your work arrangements are/were. The health insurance office will be on your side. The pension office is lazy and will make you pay the whole lot first before they chase your employer and the National Tax Service may pay you a reward as a lot of the hagwons I'm referring to here forget to remit tax they deduct to them. |
30,000 is the minimum not the max. at 30 hours a week, it equals 3.6 million won a month. Subtract 500,000 for housing. Subtract 150,000 a month for health and pension. Subtract another 80,000 for income tax. That's 2,870,000 left over as your salary. Most people are getting 2.1 to 2.3 million a month? |
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hogwonguy1979
Joined: 22 Dec 2003
Location: the racoon den
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| Posted: Tue Apr 16, 2013 11:05 pm Post subject: |
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the problem for newbies is, forget the legalities, is they are being told when they sign their contracts and come over they are getting health/pension and a low (2%) tax rate only to come over and discover the first time they get sick and go to the dr they aren't covered or have to go to nhic/pension office to sign up and do their own Korean tax returns and have 3.3% taken out for tax. Forget about the surprise if they make it through the first year without getting sick etc they move to a second job that they are not an IC and get nailed for a years worth of pension health insurance up front
If told that I bet 90 odd % of them wouldn't take the jobs
My question has always been for immigration to allow the issuance of a visa doesn't the employer have to agree the hire will be a "regular" employee.
Yeah if you are on an F visa and IC may be ok but for 99% of people here it doesn't make sense in so many ways and they are getting scammed |
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Weigookin74
Joined: 26 Oct 2009
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| Posted: Tue Apr 16, 2013 11:12 pm Post subject: |
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| hogwonguy1979 wrote: |
the problem for newbies is, forget the legalities, is they are being told when they sign their contracts and come over they are getting health/pension and a low (2%) tax rate only to come over and discover the first time they get sick and go to the dr they aren't covered or have to go to nhic/pension office to sign up and do their own Korean tax returns and have 3.3% taken out for tax. Forget about the surprise if they make it through the first year without getting sick etc they move to a second job that they are not an IC and get nailed for a years worth of pension health insurance up front
If told that I bet 90 odd % of them wouldn't take the jobs
My question has always been for immigration to allow the issuance of a visa doesn't the employer have to agree the hire will be a "regular" employee.
Yeah if you are on an F visa and IC may be ok but for 99% of people here it doesn't make sense in so many ways and they are getting scammed |
Ignorance is bliss. Naw, I agree. People who take an IC position should be told upfront and the employer should offer to take you to get signed up for the health and pension and to fill out the tax form. It can work under the right circumstances but they should be told about it upfront and given a minimum of 30,000 an hour. My calculations were based on 30 hours a week. If you work less hours and can take on an extra job legitimately or for cash, it can work out. Up to you though. |
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big_fella1
Joined: 08 Dec 2005
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| Posted: Wed Apr 17, 2013 12:10 am Post subject: |
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| Weigookin74 wrote: |
| hogwonguy1979 wrote: |
the problem for newbies is, forget the legalities, is they are being told when they sign their contracts and come over they are getting health/pension and a low (2%) tax rate only to come over and discover the first time they get sick and go to the dr they aren't covered or have to go to nhic/pension office to sign up and do their own Korean tax returns and have 3.3% taken out for tax. Forget about the surprise if they make it through the first year without getting sick etc they move to a second job that they are not an IC and get nailed for a years worth of pension health insurance up front
If told that I bet 90 odd % of them wouldn't take the jobs
My question has always been for immigration to allow the issuance of a visa doesn't the employer have to agree the hire will be a "regular" employee.
Yeah if you are on an F visa and IC may be ok but for 99% of people here it doesn't make sense in so many ways and they are getting scammed |
Ignorance is bliss. Naw, I agree. People who take an IC position should be told upfront and the employer should offer to take you to get signed up for the health and pension and to fill out the tax form. It can work under the right circumstances but they should be told about it upfront and given a minimum of 30,000 an hour. My calculations were based on 30 hours a week. If you work less hours and can take on an extra job legitimately or for cash, it can work out. Up to you though. |
The biggest problem with a first timer doing this is they can't get health insurance for the first 3 months.
I've always wondered why CDI has ICs as I know they do pay more than the benefits they're not giving, wouldn't CDI be better just to pay the benefits and have employees, as you have less control over ICs.
I know the Korean ICs at YBM adult institutes were payed per student to keep it kosher. |
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CentralCali
Joined: 17 May 2007
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| Posted: Wed Apr 17, 2013 1:12 am Post subject: |
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| big_fella1 wrote: |
| I've always wondered why CDI has ICs as I know they do pay more than the benefits they're not giving, wouldn't CDI be better just to pay the benefits and have employees, as you have less control over ICs. |
The thing is that they don't have independent contractors. Those folks are, in fact, employees. Labeling them as "independent contractors" is simply a ruse.
| Quote: |
| I know the Korean ICs at YBM adult institutes were payed per student to keep it kosher. |
Well, that's just a different ruse. The conditions of employment, such as who sets the working rules, disciplinary issues, etc., are what determines the actual relationship. |
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big_fella1
Joined: 08 Dec 2005
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| Posted: Wed Apr 17, 2013 4:43 am Post subject: |
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ontheway seems to be saying because about 50% of Korean workers are on ICs they're legal. This is great news for anyone from the US with a pot conviction, its okay, 42% of Americans have tried marijuana. Source: http://www.time.com/time/health/article/0,8599,1821697,00.html
So you can have your conviction overturned because with ontheways logic if half of the people do something its okay.
Write to your Attorney General now. |
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EZE
Joined: 05 May 2012
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| Posted: Sun Apr 21, 2013 2:39 am Post subject: |
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| hogwonguy1979 wrote: |
the problem for newbies is, forget the legalities, is they are being told when they sign their contracts and come over they are getting health/pension and a low (2%) tax rate only to come over and discover the first time they get sick and go to the dr they aren't covered or have to go to nhic/pension office to sign up and do their own Korean tax returns and have 3.3% taken out for tax. Forget about the surprise if they make it through the first year without getting sick etc they move to a second job that they are not an IC and get nailed for a years worth of pension health insurance up front
If told that I bet 90 odd % of them wouldn't take the jobs
My question has always been for immigration to allow the issuance of a visa doesn't the employer have to agree the hire will be a "regular" employee.
Yeah if you are on an F visa and IC may be ok but for 99% of people here it doesn't make sense in so many ways and they are getting scammed |
+1 |
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ghostrider
Joined: 27 Jun 2011
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| Posted: Sun Apr 21, 2013 5:36 am Post subject: |
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| This battle has already been fought and lost. Some foreign teachers sued CDI for hiring them as independent contractors. A Korean judge ruled that what CDI was doing was legal. Some hagwons won't pay pension or health insurance and there's not much you can do about it. |
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big_fella1
Joined: 08 Dec 2005
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| Posted: Sun Apr 21, 2013 6:04 am Post subject: |
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| ghostrider wrote: |
| This battle has already been fought and lost. Some foreign teachers sued CDI for hiring them as independent contractors. A Korean judge ruled that what CDI was doing was legal. Some hagwons won't pay pension or health insurance and there's not much you can do about it. |
Have you got a reference that the case was lost? You say a Korean judge ruled, what was the decision of the labour board and who appealed to the court.
Not that CDI is the standard situation as some of the employees in that case were making more than 30k per hour which was my understanding as to why the case had bogged down.
I always figured that CDI settled with some very stringent non-disclosure agreements which is why there had been no publicity regarding the case so without a reference I don't believe your claim. |
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EZE
Joined: 05 May 2012
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| Posted: Sun Apr 21, 2013 7:05 am Post subject: |
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| Skippy wrote: |
| So if NPS and NHIC find out you been have not been enrolled. You can be expect to both payback the time you where not enrolled plus a fine (percentage). |
What percentage is the fine? |
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Skippy
Joined: 18 Jan 2003
Location: Daejeon
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| Posted: Sun Apr 21, 2013 7:28 am Post subject: |
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| EZE wrote: |
| Skippy wrote: |
| So if NPS and NHIC find out you been have not been enrolled. You can be expect to both payback the time you where not enrolled plus a fine (percentage). |
What percentage is the fine? |
One minute to find from the NPS site
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The employer is obliged to pay his portion of the contribution with the employee's contribution deducted from wage. The individually, voluntarily, and voluntarily & continuously insured persons are responsible to pay all their contributions. In the event of failure to pay the contribution by due date, an arrears charge will be imposed at a rate ranging from 3% to 9% of the contribution amount, according to the number of months delayed. |
http://english.nps.or.kr/jsppage/english/scheme/scheme_02.jsp |
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EZE
Joined: 05 May 2012
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| Posted: Sun Apr 21, 2013 9:54 am Post subject: |
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| Thanks Skippy. |
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ontheway
Joined: 24 Aug 2005
Location: Somewhere under the rainbow...
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| Posted: Sun Apr 21, 2013 11:12 am Post subject: |
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| ghostrider wrote: |
| This battle has already been fought and lost. Some foreign teachers sued CDI for hiring them as independent contractors. A Korean judge ruled that what CDI was doing was legal. Some hagwons won't pay pension or health insurance and there's not much you can do about it. |
I've never heard that this case had ended by either a court judgement or a settlement of some kind. It has been a long time, so it could be either, it could be bogged down in the system somewhere - or it could even a combination of all three things. There were a many teachers and many issues to be delt with, so it wouldn't be surprising to find wins and losses on both sides. More info would be interesting. |
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ontheway
Joined: 24 Aug 2005
Location: Somewhere under the rainbow...
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| Posted: Sun Apr 21, 2013 11:28 am Post subject: |
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| big_fella1 wrote: |
ontheway seems to be saying because about 50% of Korean workers are on ICs they're legal. This is great news for anyone from the US with a pot conviction, its okay, 42% of Americans have tried marijuana. Source: http://www.time.com/time/health/article/0,8599,1821697,00.html
So you can have your conviction overturned because with ontheways logic if half of the people do something its okay.
Write to your Attorney General now. |
Actually, your reading comprehension seems to have failed you along with logic.
What I said was that not only is it legal at the present time to be an IC in Korea - and no one including you has shown anything to the contrary - but that because over 50% of Koreans are in this category (not exactly the same as IC in English, but it includes what we call IC in English) the Korean government is not about to suddenly make it illegal and destroy their economy.
As to marijuana in the US: it is now true that over 50% of the public favors outright legalization, and states are voting to do just that - Colorado and Washington last November. If 42% admit to having used marijuana (and the actual number is likely far higher) it seems inevitable that most of the states and the Federal government will follow. Eventually, pardons will be issued to many of those convicted in the past in at least some of those states and some individuals will have their records expunged.
But climb up on your high donkey and go attack a few windmills BigFella. Your antics are entertaining. Will you wear armor and a mask? As you ride off into the sunset, be sure to holler, "Hi ho, Otay, away!" |
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