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fosterman
Joined: 16 Nov 2011
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 Posted: Thu May 22, 2014 5:57 pm Post subject: After schools not paying pension, medical , ILLEGAL? |
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hi, just curious, does the after school program have to pay the national pension by law? and medical?
by them not paying it are they actually breaking the labor law to save themselves money? or legally don't have to pay pension? |
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ttompatz
Joined: 05 Sep 2005
Location: Kwangju, South Korea
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| Posted: Thu May 22, 2014 6:17 pm Post subject: Re: After schools not paying pension, medical , ILLEGAL? |
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| fosterman wrote: |
hi, just curious, does the after school program have to pay the national pension by law? and medical?
by them not paying it are they actually breaking the labor law to save themselves money? or legally don't have to pay pension? |
IF you are an "employee" then yes, they are required to by law.
If you are an independent contractor then no, they do not have to.
If they class you as an independent contractor and you are on an E2 then they are probably violating the law (immigration and labor).
To get an E2 you have to be "employed" as a teacher of foreign languages (makes you an employee and not a subcontractor).
If they determine what you teach, when you teach and the terms of your employment then you are NOT "independent".
Plumbers are an example of an independent contractor (or contracted agency)
- they arrive on their own schedule, are NOT told how to do their job and leave at their convenience.
- If you work on a fixed schedule, do what your employer tells you to do in the manner your employer tells you then you are an employee and NOT "independent" as a contractor.
Your employer may be a contractor but YOU are an employee.
Typically, if you work for an A/S program and not directly hired by the school then you will get screwed.
I expect "alongtheway" to pop in here shortly and argue the opposite (you can be an IC on an E2) but the truth is that he is just another tout for a sleezy hagwon AND employers who do that ARE skirting the law (and hoping that no-one will hang around long enough or have deep enough pockets to do anything about it).
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yfb
Joined: 29 Jan 2009
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| Posted: Thu May 22, 2014 11:15 pm Post subject: Re: After schools not paying pension, medical , ILLEGAL? |
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| Quote: |
| I expect "alongtheway" to pop in here shortly and argue the opposite |
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Weigookin74
Joined: 26 Oct 2009
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| Posted: Fri May 23, 2014 9:30 am Post subject: |
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| Problem is immigration accepts the independant contractor even though it's illegal. Key is to ensure a high enough pay so you can pay both your employer and yours medical insurance and pension. Otherwise, you're SOL. The National Health body will chase them to pay if you're an employee but you will have to back pay your contributions too. |
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ontheway
Joined: 24 Aug 2005
Location: Somewhere under the rainbow...
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| Posted: Fri May 23, 2014 10:05 am Post subject: |
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| Weigookin74 wrote: |
| Problem is immigration accepts the independant contractor even though it's illegal. Key is to ensure a high enough pay so you can pay both your employer and yours medical insurance and pension. Otherwise, you're SOL. The National Health body will chase them to pay if you're an employee but you will have to back pay your contributions too. |
Immigration accepts what we refer to as Independent Contractor (IC) contracts because they are legal. Immigration reads and accepts contracts that specifically state that the individual being sponsored will be an IC and not an employee with the IC tax rate and pension and health care being the reponsibility of the worker - 100% paid by the worker and nothing from the sponsor.
The E2 visa is a working visa; under Korean law both employees and ICs are workers.
There is nothing in the Immigration rules or law that prohibits an E2 visa holder from being an IC. Hence, it is legal.
Part of the confusion comes from the translation. The Korean term isn't the same as IC - we use that as a convenient, shorthand reference. In actuality under Korean law ICs are workers who have registered as personally responsible for their own business income. This category is under the jurisdiction of the Tax Office. It is not under either Immigration or Labor; they have no jurisdiction, meaning no say in the matter.
Another part of the confusion is posters who want so badly for IC status to be illegal, that they make up their own Immigration rules in their minds, but they have no legal background or understanding.
In law, the government can define terms any way they like. If they define a cat as a long, legless reptile, then legally that is a cat.
What we refer to as an IC in Korea does not require the worker to work at multiple workplaces or to control their own work duties or schedule. It is not defined that way currently under the law.
This should not be surprising to anyone who understands the way government works - it is not about what is right, good or correct. It is about power, good or bad.
The history of the IC rules in the US shows a similar situation. There was a time - up until the late 1980s - that ICs were able to work at a single workplace with all duties and hours controlled by the boss. As an example, many businesses had IC secretaries with exactly the same hours, duties and work conditions as employee secretaries sitting side by side in the same office. However, having IC status could save a great deal of money in taxes due for both the business and the worker - so many people were using this scheme. The only loser was the IRS. So they gradually changed the rules in order to scoop up more money. Many workers were "grandfathered in" and able to keep their status, but the rules were made much more strict for new workers. It was the workers who ended up as losers from this loss of status.
In Korea at the present time half of all workers fall under this business income category that we are calling ICs. The government is not going to change the rules overnight for a handful of E2 teachers. Like the US, they may someday change the rules, slowly, so as not to disturb the economy. An overnight end to this worker tax status would cause a severe recession across Korea.
We need to recognize that this is a legal status. It is better for newbie teachers to know that you can legally work as an IC and that the government won't help you if you have been legally and properly enrolled as such.
Since most - nearly all - E2 teachers will lose if they are working as ICs and legally pay 100 % of the National Health and National Pension as they are required to do as ICs, new teachers should watch out for and refuse to accept IC contracts. You will not get help after the fact by the government.
However, if your contract states that you are an employee, you have a case against your employer for enrolling you as an IC. It isn't the IC status that is illegal at that point, however. It is the fraud involved in the contract - civil and possibly criminal depending on the facts of the case. Sometimes the Pension and HI offices will help out in these cases.
But, since it is not illegal for an E2 visa holder to be an IC, running around claiming that it is illegal will get you thrown out of the Pension of HI office and will get you no cooperation from your boss, as we have had reported here many times by E2s trying to fignt being an IC after the fact.
So, ignore Ttompatz.
It is legal but a bad deal to be an IC as an E2 teacher in Korea. In fact, it is probably a bad deal for most F visa holders as well. Only if you are able to work multiple jobs without benefits and much higher hourly rates as a result - which I've seen done by two personal friends with families - can you make out as an IC on an E2.
For everyone else, while it is legal to be an IC on an E2 visa, you should refuse all such IC contracts. You have to look out for yourself. The government will not help you out when you sign a bad IC contract. They will, however, come after you for 100% of your back payments for Pension and National Health Insurance if you don't make them and if you're in Korea long enough you will be caught.
Being legal doesn't make it good for you. Just say no to being an IC. It's up to you. |
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