Korean Job Discussion Forums

[malandlu]

Hi everyone.

I have been organizing my first contract in Korea and hitting the usual headaches that I feel many go through when choosing to work here. Maybe I should just go back to doing ESL anywhere else! &

I have finally sorted out all of the conditions of my employment and have got 'on paper' a pretty sweet deal. However one area is still a pain and this is regarding the whole independent contractor v employee malarki. after reading all of the posts on the subject and researching where I can, I think I have a pretty good grasp of the situation but I felt it was worth posting the letter I received from my Schools Tax accountants. At least one thing is clear from this, it doesn�t matter what country your in accountants are all bent!

I have added my notes as to what I think the real deal is from my research and am hoping some people could check the details for accuracy and maybe also check if I am missing anything. All percentages/ratios are based on gross monthly salary

------------------------------
The letter:

Please find below the break down of the differences between being registered as an employee or independent contractor. You will clearly see that the latter is better/cheaper and most teachers choose to be registered as a independent contractor yeah right!!!

income tax:
Independent contractor - ratio 3.0%
Employee � ratio 3.3% + 10% of income tax for resident tax

Firstly they even have the independent contractor rate wrong (or mixed up) as should be 3.3% plus the employee rate should be as per the income tax websites rate at much lower then this
Question � does the NTS online calculator rates include resident tax or is this on top?

Medical insurance:
Independent - 5.08% plus 4.05% of this figure for this years increased medical ratio. As an independent contractor medical is paid at ones own expense however we are prepared to help with this burden by paying 50% of this ourselves
Employee � 2.54% + the employeer pays 2.54% also as employee, national pension/unemployment insurance and industrial disaster insurance must be paid

National pension
Independent contractor � not applicable
Employee � 4.5% + 4.5% paid by the employer

Unemployment insurance
Independent contractor � not applicable
Employee 0.45% of monthly salary

As I understand this, E2 visa holders are exempt. Correct?

Industrial disaster insurance
Independent contractor � not applicable
Employee 0.3% paid by the employer

No skin off my nose!

End of letter
-----------------------------------------------------

Right so heres the crux of my problem, As I understand it there is no way that I can legally work as an independent contractor as E2 visa forbids it and it is obviously used as a tax work around by my employer. However benefits wise I am still sure I will receive my severance as it is in the contract (as an employee by the way) plus has been paid to previous teachers that loved the place but never read there contracts (seriously I cant believe how many don�t seem too) and my employer is promising still to pay my Medical insurance thus meaning I assume I would still be medically covered. I will of course check this myself and ensure I receive my insurance card.

As I am from the UK I do not have the luxury of a pension refund and have zero interest in the industrial disaster insurance (attacked by rampaging pre-schoolers) and unemployment insurance. So if I can ensure that my severance is paid and that my medical is definitely paid (plus I get all the figures corrected above) then would I not be better off letting the school do the tax workaround as it seems pretty common anyway and then I save myself 4.5% wasted pension costs??? Not to mention that from my chat with the tax office they strangely don�t seem to fused about this themselves (crazy I know) im sure I could negotiate a pay increase for the inconvenience as well assuming that this is not horrifically unethical and illegal

If the employer proves there medical contributions will I actually be covered? Or will I be asked to pay 11 months back dated pension contributions before they will sort my ruptured spleen or remove me from the traffic accident scene in the ambulance?

I think the point is I am happy with the school and have loads of feedback from current and past teachers re the payments/situation and work style though its still a Hagwon which messes with the system it just seems the principle/ accountant is looking to screw the government as opposed to the teachers (I hope)

Hope this all makes sense can�t wait to get this debate going�. Again!

Cheers
m

[CentralCali]

The recent case between a group of female employees and KTX was determined in favor of the employees. The court held that regardless of the term used in the contract to identify those employees as "independent contractors," they were, in fact, employees. The court based that determination on the stipulations of the contract regarding setting of working hours, working conditions, supervision, and discipline. These are all the same things that appear, of course, in your contract. You therefore are not and cannot be considered, in fact, an independent contractor. Further evidence of that fact is that you are not your own sponsor if you work for them on an E-series visa.

I would not trust them regarding the medical insurance. They say they are prepared to help pay that. What does that really mean? It means they can easily not pay it. I just spent a month in the hospital and I'm quite pleased that I was covered under the medical insurance. Are you prepared to pay for a stay that long and for surgeries at your expense?

And last I heard, unemployment insurance is voluntary.

[malandlu]

[CentralCali]

To be blunt, you'd be a fool to take that job. They're at least telling you up front that they're not going to honor the labor laws. Why then would you trust them to honor anything else?