Korean Job Discussion Forums

Jerry Todd · Joined: 15 Apr 2009

hi,

so since i'm leaving korea in a few weeks, i went to my regional pension office to get the ball rolling. when i went in i had a figure in my head and on paper which i thought i was going to receive. however, when the pension officer showed me my pension statement, the total amount was significantly lower (about 700,000 lower).

after lots of questions with the pension officer and the accountant at my school, i've come to an answer. the korean government has allowed employers (possibly only public schools, not sure) to under claim the amount of income of its employees by 30% to the pension office if you worked in 2009.

i asked for some official documentation pertaining to the 30% reduction. i was given a letter, all in korean. according to the pension officer everything is okay and the school is allowed, by law, to under claim employees incomes.

i guess i just have to take this lying down as they say. has anyone else experienced this?

i've found this,

http://www.zimbio.com/Seoul+South+Korea/articles/Op6e7PVS7tu/Being+Cheated+Out+Pension

WadRUG'naDoo · Joined: 15 Jun 2010 Location: Shanghai

This one was nice:

"The administration office told my co-teacher they were only going to explain it to me if I noticed"

Anyway, did you contribute 4.5% of your base salary? Like if you made 2 million, did you pay 90,000 a month into it? If so, and you're only getting back 9% of 70% of your salary, there's a problem with what you contributed. They can't ask you to contribute 4.5% of 100% of your salary and turn around and give you back 70% of that.

Jerry Todd · Joined: 15 Apr 2009

from sept. 2009 until june 2010 my employer and i paid 9% of my acutal salary.

from july 2010 until feb. 2011 my employer and i paid/will pay 9% of 70% of my actual salary.

fugitive chicken · Joined: 20 Apr 2010 Location: Bucheon

interesting...just went to the pension office today and was wondering why my salary from july 2009-july 2010 was 1.7 mill...guess that is why!

interestedinhanguk · Joined: 23 Aug 2010

This seems to make sense.
(I'm not sure about exact dates)
I talked to the pension office about this in 2009 and 2010. I was at the same school both years.
In 2009 my school was legally able to base pension (4.5%) each on 70% of my total salary. So, if I made 2,000,000 won, they could report income as 1,400,000 (.7*2,000,000). Then we would each pay 63,000 per month (.045*1,400,000).
Supposedly the basis for this was that only 70% of my salary was taxable or something (I believe because I'm a foreigner).

I signed a new contract in Feb 2010. My salary increased for signing for a second year. I called the pension office to clear things up about my new rate and just to check up.
It turns out that in 2010, employers had to base pension on 100% of income (unlike 70% in the previous year). HOWEVER, if one had worked at the same place (as I had) in 2009, the employer could still base pension on 70% of income. This is regardless of the fact that I had a new contract and new salary.

Therefore, if I had changed schools in 2010, my new employer would have to base pension on 100% of salary. Since I stayed with the same school from 2009, my pension was based on 70%.

This was all legal and standard by the pension office (I spoke with a fluent English speaker at the office).

Big Mac · Joined: 17 Sep 2005

That article kind of annoys me.

They didn't attribute those quotes to anybody. I'm pretty sure that some of those quotes came directly from a post that I made on Dave's ESL Cafe a year or so ago.

WadRUG'naDoo · Joined: 15 Jun 2010 Location: Shanghai

interestedinhanguk · Joined: 23 Aug 2010

The 30% deal is no longer. Foreigners before were only taxed on 70% of income. I don't know if it changed to 100% last year or what (as far as taxes are concerned).

Nonetheless, I heard it from more than one person at the pension office about the 70% being carried into 2010 if staying with the same employer. The pension office worker understood the strangeness of it all, but they seemed fully informed about it.

Tell me, does a lot of the bureaucracy make sense? Confused

WadRUG'naDoo · Joined: 15 Jun 2010 Location: Shanghai

Sounds like a big clusterfudge to me.

If I wanted to work in Korea (and I don't), I'd find a mom-n-pop hagwon and forego taxes and pension and get paid straight up. What I'm hearing in this thread thows all trust in the system out the window.

winterfall · Joined: 21 May 2009

I got nervous after reading this. I called the pension office, 3 different branches. It's not legal to under report your income. Try calling the gangnam office, they've got a fluent speaker there. Visit a pension office and get your statement, it'll show how much your reported income per month is and bring a copy of your contract and a pay stub to one of the fluent speaking pension offices. They're call the school / investigate.

Whatever statement they showed you is BS. Worse comes to worse call the labor board. And if that doesn't work call the police since it IS a criminal offense.