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trillmix
Joined: 22 Feb 2016
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 Posted: Thu Apr 07, 2016 10:04 am Post subject: Independent Contractor vs. Full-Time Employee |
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Hi all. I've been reading on here that an IC doesn't get the same benefits as an FTE and are taxed at a 3.3% rate. Benefits such as NHIC and pension. I'm a little confused as I'm combing through a document that would label one as a IC but is given severance, pension, monthly payment, health insurance, etc.
Two options were given for the taxation:
1. Pay into health insurance and pension
2. Pay 3.3% tax rate, no pension at the end |
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CentralCali
Joined: 17 May 2007
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| Posted: Thu Apr 07, 2016 2:21 pm Post subject: |
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| No need to be confused. You're reading CDI's latest lie...er, contract. Do yourself a favor and look for a job with a trustworthy outfit instead. |
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trillmix
Joined: 22 Feb 2016
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| Posted: Thu Apr 07, 2016 3:19 pm Post subject: |
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Thanks for your input! Would you mind clarifying? What makes you think it's by CDI? Are they notorious for using this language? They were recently sued so I would assume that they wouldn't make the same mistake twice - is that naive thinking?
The contract clearly lists out that the employer and teacher will pay 50/50 for insurance/pension, get severance, etc. Is there a loophole in the language? |
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Savant
Joined: 25 May 2007
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| Posted: Thu Apr 07, 2016 9:15 pm Post subject: |
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| trillmix wrote: |
Thanks for your input! Would you mind clarifying? What makes you think it's by CDI? Are they notorious for using this language? They were recently sued so I would assume that they wouldn't make the same mistake twice - is that naive thinking?
The contract clearly lists out that the employer and teacher will pay 50/50 for insurance/pension, get severance, etc. Is there a loophole in the language? |
Don't put too much faith in "The contract clearly lists...."
The loophole is in the law and the combined offices of Immigration, Tax, Pension and NHIC unwillingness to clampdown on illegal IC contracts.
I think Pension now comes under the umbrella of NHIC but like all Korean bureaucracy, the right hand doesn't know or cares if the left hand exists or not. |
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Weigookin74
Joined: 26 Oct 2009
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| Posted: Thu Apr 07, 2016 10:07 pm Post subject: |
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| Pension and Medical must be paid together. One of them is the enforcement arm. If you sign a contract and are on an E2 visa, it must be paid. After 3 months or so, you can call to check to make sure it's been paid and report it if it isn't. It must be paid, no excuses, the office will not accept excuses and one of them will enforce it. But, less than six months in a boss can more easily fire? Not sure. So, wait until the 6 month mark to call and report if it's not paid. Doesn't matter what contract crap the boss tries to pull. An E2 cannot be an independant contractor. If you are an independant contractor, then you wouldn't have to sign a contract. If a contract lists no public insurance or pension (which must legally be paid together), then walk away from it. |
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Weigookin74
Joined: 26 Oct 2009
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| Posted: Thu Apr 07, 2016 10:09 pm Post subject: |
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| CentralCali wrote: |
| No need to be confused. You're reading CDI's latest lie...er, contract. Do yourself a favor and look for a job with a trustworthy outfit instead. |
Recent job offers from CDI don't list that and promise pension and medical. Think they had a ruling against them? |
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FastForward
Joined: 04 Jul 2011
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| Posted: Thu Apr 07, 2016 10:27 pm Post subject: |
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| Weigookin74 wrote: |
| Pension and Medical must be paid together. One of them is the enforcement arm. If you sign a contract and are on an E2 visa, it must be paid. After 3 months or so, you can call to check to make sure it's been paid and report it if it isn't. It must be paid, no excuses, the office will not accept excuses and one of them will enforce it. But, less than six months in a boss can more easily fire? Not sure. So, wait until the 6 month mark to call and report if it's not paid. Doesn't matter what contract crap the boss tries to pull. An E2 cannot be an independant contractor. If you are an independant contractor, then you wouldn't have to sign a contract. If a contract lists no public insurance or pension (which must legally be paid together), then walk away from it. |
Pension office actually won't enforce anything. My last school owes me over 1,000,000 in back pension and the pension office did nothing. Was told to call the local office and all they did was call the school to tell them to pay it. They told me that is all they can do. Their solution was to just wait on the school to pay it.......
So in my experience the school can not pay your pension and nothing will be done about it. |
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Weigookin74
Joined: 26 Oct 2009
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| Posted: Fri Apr 08, 2016 1:53 am Post subject: |
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| FastForward wrote: |
| Weigookin74 wrote: |
| Pension and Medical must be paid together. One of them is the enforcement arm. If you sign a contract and are on an E2 visa, it must be paid. After 3 months or so, you can call to check to make sure it's been paid and report it if it isn't. It must be paid, no excuses, the office will not accept excuses and one of them will enforce it. But, less than six months in a boss can more easily fire? Not sure. So, wait until the 6 month mark to call and report if it's not paid. Doesn't matter what contract crap the boss tries to pull. An E2 cannot be an independant contractor. If you are an independant contractor, then you wouldn't have to sign a contract. If a contract lists no public insurance or pension (which must legally be paid together), then walk away from it. |
Pension office actually won't enforce anything. My last school owes me over 1,000,000 in back pension and the pension office did nothing. Was told to call the local office and all they did was call the school to tell them to pay it. They told me that is all they can do. Their solution was to just wait on the school to pay it.......
So in my experience the school can not pay your pension and nothing will be done about it. |
Ok, then call the NHS office. (Medical insurance.) They must be the ones who enforce it. One of the bodies does have the power to enforce, while one does not. I forgot which one does. But you have to pay both and they are linked even if different government agencies. I had read this before. |
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CentralCali
Joined: 17 May 2007
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| Posted: Fri Apr 08, 2016 4:38 am Post subject: Re: Independent Contractor vs. Full-Time Employee |
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| trillmix wrote: |
Hi all. I've been reading on here that an IC doesn't get the same benefits as an FTE and are taxed at a 3.3% rate. Benefits such as NHIC and pension. I'm a little confused as I'm combing through a document that would label one as a IC but is given severance, pension, monthly payment, health insurance, etc.
Two options were given for the taxation:
1. Pay into health insurance and pension
2. Pay 3.3% tax rate, no pension at the end |
This outfit, which you haven't named but it sure looks like the infamous one which got reamed in the courts, is pretending that you have a choice. You don't. The law is that you pay into health and you pay into pension. The law further requires the employer to match your contributions to both health and pension. Go ahead; take a wild guess which one of those two options the unnamed outfit really and truly wants you to take.
They're also trying to be clever with that "no pension at the end" malarkey. You get a pension lump-sum (depending on your nationality) after you leave Korea. If you stick around in the country long enough, you can even start getting actual pension payments. What they're trying to pull is not pay you the severance pay. |
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CentralCali
Joined: 17 May 2007
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| Posted: Fri Apr 08, 2016 4:44 am Post subject: |
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| trillmix wrote: |
| Thanks for your input! Would you mind clarifying? What makes you think it's by CDI? Are they notorious for using this language? They were recently sued so I would assume that they wouldn't make the same mistake twice - is that naive thinking? |
In reverse order:
- Yes, it's naivete.
- The provisions you quoted look very much like CDI's infamous "IC" stunt, albeit this one is a little bit murkier--but not so much that it's not still visible.
- CDI are scum, but they're rather big scum. Of course they're going to try to keep operating as they always have.
- I clarified somewhat in my previous post just above this one.
| Quote: |
| The contract clearly lists out that the employer and teacher will pay 50/50 for insurance/pension, get severance, etc. Is there a loophole in the language? |
Not so much a loophole as a "Bam!" If you and your employer don't pay into pension, then there's nothing to pay out for you. And don't be surprised if they pull another stunt that's not unheard of (and, by the way, my first employer in Korea tried): deducting how much you should have paid into pension and national health, reported your salary to those two offices as one half of your actual salary, paying into those two funds what the proper amount would have been for said lower salary, and then, you guessed it, turning over the entire amount that they deducted from your actual salary. That, of course, means that they weren't paying into either fund at all.
So, anyway, who is this particular outfit you're dealing with, CDI or Wonderland? |
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trillmix
Joined: 22 Feb 2016
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| Posted: Fri Apr 08, 2016 10:40 am Post subject: |
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Hi everyone. Thanks a lot for your advice. Please keep the hard truth coming.
Are there any official websites or documents that clearly states the differences between IC and FTE? I'm going off of outdated blogs and opinions right now. Really, I'm baffled at the fact that CDI would try to pull another fast one when they were literally just sued. So I'm straying away from them.
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This particular one lists out the benefits entitled to an E2 Visa holder/FTE status, but labeled as an IC within it. But to my understanding from other findings, you can't be an IC on an E2. Which is why I'm utterly confused. It doesn't help that I was able to talk to one of the foreign teachers there, whose been working there for a couple of years, so I'm most likely only hearing positive things.
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The school was advising towards taking pension as the 3.3% option wouldn't make sense. But the contract states one as an IC and that:
1. One is eligible for severance
2. Employer and teacher will bear 50/50 of total health and applicable pension payments, employer will help find insurance, etc
Nowhere in the contract does it say a 3.3% tax rate. So...I guess my main question would be, if the supposed benefits are for an FTE, what's the catch for labeling one as an IC?
I'm also curious as to how you've all concluded that this all points to CDI/Wonderland and not another Hagwon?
I would rather not state the entity on here. If any of you are skilled at fine-tooth combing through a document though, I'd love to PM you. |
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CentralCali
Joined: 17 May 2007
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| Posted: Fri Apr 08, 2016 1:25 pm Post subject: |
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The catch is that if you are an IC, then when the school does not actually pay into the national health insurance and national pension schemes, and does not actually pay you severance at the end of your contract; you are not covered under the laws mandating those for FTE. It would be a contractual issue providing that the contract says the school would pay those items and you would have to seek remedy in the courts, not the NHI & NPS offices nor the Labor Board.
And I see that the school isn't really going to pay into the NHI. According to your last post, the school would "help find insurance". Nobody needs help finding the national health insurance scheme.
CDI & Wonderland are (in)famous hagweon chains. The reason they are well-known isn't "They are wonderful places to work, they treat their foreign instructors decently, and follow the laws relating to compensation, health insurance, and pension".
Is this the best offer you've gotten from Korea so far? If so, perhaps you should widen your search parameters to other countries. |
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CentralCali
Joined: 17 May 2007
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| Posted: Sat Apr 09, 2016 7:53 am Post subject: |
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| trillmix wrote: |
| I would rather not state the entity on here. If any of you are skilled at fine-tooth combing through a document though, I'd love to PM you. |
As long as you remove the corporate and personal names from the proffered contract, you can post it in this board's contract thread. More than a few of the regular posters here are pretty good at appraising contracts. |
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trillmix
Joined: 22 Feb 2016
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| Posted: Sat Apr 09, 2016 9:46 am Post subject: |
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Thanks a lot CentralCali for your sound advice! That makes sense as I've read that before. I guess I'm giving too much benefit of the doubt.
I'm trying to figure out how to block out names with free adobe readers (Adobe XI) or another program right now. Where can I find this thread dedicated to contracts? |
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trueblue
Joined: 15 Jun 2014
Location: In between the lines
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| Posted: Sun Apr 10, 2016 7:30 pm Post subject: |
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| trillmix wrote: |
Thanks a lot CentralCali for your sound advice! That makes sense as I've read that before. I guess I'm giving too much benefit of the doubt.
I'm trying to figure out how to block out names with free adobe readers (Adobe XI) or another program right now. Where can I find this thread dedicated to contracts? |
Just avoid CDI...simple (should this be in reference to them). |
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