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hypemo7
Joined: 05 Apr 2011
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 Posted: Fri Aug 26, 2011 4:08 am Post subject: Pension/Medical Insurance....Is my boss making this up? |
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SO I'm booked to leave at the end of my contract next monday and a problem has come up with my pension refund. Earlier in the year my boss gave me the option to opt out of medical insurance and I took this, thinking I would save money.
However, she told me last week that the insurance company and the pension company had "merged into one" and she could no longer get away with not giving us medical insurance. Due to this, she says I have to pay about 700,000 won for the year's worth of medical insurance. Basically, she can't get away with it because the companies are together.
She's saying that she'll take the money out of my last pay without me doing any forms or anything for the insurance and at the pension office today, no mention was made of the insurance money.
Is this at all legit or is she completely making this up to take this money from me? It just seems odd having to hand over that much cash at the end of my contract for something that i shouldve had the whole year, but didnt.
Any input on this would be greatly appreciated, sorry if I was confusing! |
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liveinkorea316
Joined: 20 Aug 2010
Location: South Korea
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| Posted: Fri Aug 26, 2011 6:06 am Post subject: Re: Pension/Medical Insurance....Is my boss making this up? |
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| There is no such thing as 'opting out' of medical insurance in Korea. It is a TAX not an employee benefit. You boss is pulling your leg about the merging business. Basically the effect is right though - YOU do owe the unpaid medical. I have no idea how it could reach 700,000won though. Mine usually is deducted at about 70k per month. |
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hogwonguy1979
Joined: 22 Dec 2003
Location: the racoon den
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| Posted: Fri Aug 26, 2011 6:51 am Post subject: |
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your employer is sc$ewing you, if she hasnt contributed to either for the entire contract, you'd owe around 1.2 mill for pension plus another 600k for health insurance (plus or minus depending on your salary).
it was blantantly illegal for her to not enroll you in pension and nhic, but thats another thread.
hope you post the name of the school for people to avoid
Again nhic and pension ARE MANDATORY FOR E2 holders, your employer has to agree to this in order for them to get your visa confirmation number. Hold them to it |
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Ice Tea
Joined: 23 Nov 2008
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| Posted: Fri Aug 26, 2011 7:06 am Post subject: |
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| I wouldn't say she's screwing you just yet. We are missing a few key pieces of information. First you need to find out if your pension was paid into. Ask her for "국민연금 가입내역안내서". If there's money on it, then yes, you do owe for your health insurance. If it's blank or she won't give it to you, then she's screwing you. Tell her to pay into your pension first everything that is owed and then you'll pay the medical insurance. If she refuses, which she will, go the labor board nd they'll sort it out. |
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World Traveler
Joined: 29 May 2009
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| Posted: Fri Aug 26, 2011 7:28 am Post subject: |
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| hogwonguy1979 wrote: |
| Again nhic and pension ARE MANDATORY FOR E2 holders, your employer has to agree to this in order for them to get your visa confirmation number. |
Seriously?! Can you provide proof? Not that I doubt you, but if you could show evidence, this would settle the independent contractor debate once and for all. (At least one poster on here claims it is legal for an E-2 to be an independent contractor.) I'm just not sure whether this is a legal gray area or what. Can you expand on what you said? |
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koreatimes
Joined: 07 Jun 2011
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| Posted: Fri Aug 26, 2011 8:29 am Post subject: |
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| Quote: |
| Earlier in the year my boss gave me the option to opt out of medical insurance and I took this, thinking I would save money. |
| Quote: |
| Is this at all legit or is she completely making this up to take this money from me? |
So, if you can't cheat the system, then someone else is taking money from you? Sounds like you need to sort things out LEGITIMATELY and then see where you stand. |
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ontheway
Joined: 24 Aug 2005
Location: Somewhere under the rainbow...
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| Posted: Fri Aug 26, 2011 8:29 am Post subject: |
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| World Traveler wrote: |
| hogwonguy1979 wrote: |
| Again nhic and pension ARE MANDATORY FOR E2 holders, your employer has to agree to this in order for them to get your visa confirmation number. |
Seriously?! Can you provide proof? Not that I doubt you, but if you could show evidence, this would settle the independent contractor debate once and for all. (At least one poster on here claims it is legal for an E-2 to be an independent contractor.) I'm just not sure whether this is a legal gray area or what. Can you expand on what you said? |
Much confusion by the responders here.
Pension and health insurance are now linked. They have not merged, but you do have to pay into both in Korea.
Employees of a business are required to pay both National Pension and National Health insurance (and yes, they are essentially a tax as mentioned above) through their employer. The normal arrangement is for the employer to pay half and the employee to pay half. However, it would be legal for the employer to pay the entire amount.
Independent contractors are required to pay their own pension and health insurance. They are not exempt. However, the school or business contracting for their services is exempt. It is up to the independent contractor to make sure that he/she has bargained for a higher pay level that makes being resonsible for his/her own pension and health insurance an attractive option.
E2 visa holders can be independent contractors legally in Korea.
In fact, it is essential for many E2 visa holders to be able to be independent contractors. Imagine you have managed to get a legal, second or even third job on your E2. If you could not work as an independent contractor, at least at the extra jobs, you would be required to pay your pension and health insurance again with each job. Since it is possible for a part time job to have health insurance payments greater than the pension, this could be quite a money loser (even if the pension payment may be refundable) and would make you less attractive to a school for a part time add on job.
Immigration rules allow multiple jobs on an E2 visa which means the tax office has correctly allowed this practice. Whether or not any individual should legally be treated as an independent contractor is based on the contract. If it states that you are an employee - then you are. If it states that you are an independent contractor - then you are. If it's unclear, then it's open to interpretation and challenge.
There is presently a lawsuit against CDI that could change the current rules for E2 visa holders and eliminate the now legal possibility of working as an indpendent contractor. However, if the court considers technical factors, such as multiple job holders, they will not go that far.
To date there is no news beyond the announcement of the lawsuit, and it could be months, years or never come to any reported conclusion. Perhaps it has already been quietly shelved. |
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ontheway
Joined: 24 Aug 2005
Location: Somewhere under the rainbow...
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| Posted: Fri Aug 26, 2011 8:40 am Post subject: |
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For the OP:
In your case, you are apparently in the process of obtaining your Pension refund, so that means that you and your employer made payments to the National Pension all year and now you are getting a refund. Since you don't mention the amounts, I'm asuming that you are satisfied that the amounts deduced from you and matched by your employer are correct and you just want the refund.
You also apparently agreed with your employer to illegally fail to enroll in the National Health Insurance scheme. It's understandable that a healthy person would want to take this risky bet and save an extra 60k won or more per month. However, the two programs are now linked and if you enroll in one they will eventually find out if you have failed to sign up for the other. So, you and your boss got caught and you both have to pay.
Health insurance is a percentage of your pay, and 60,000 won per month for 12 months is a possible ballpark guess for a teacher's one half share for health insurance for a year. 60k for 12 months comes to 720,000 won which means that you could very well owe that 700,000.
It might hurt a bit to pay all at once, but you got caught. You should expect to pay. Nice try. |
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hypemo7
Joined: 05 Apr 2011
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| Posted: Fri Aug 26, 2011 7:03 pm Post subject: |
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Thanks for the input guys, I really had no idea what the deal was for this whole thing and I'm sorry that I wasn't more clear in my original post.
My pension was paid into and sorted out for the lump sum payment yesterday, my boss wrote down a number around 1.4 mil and told me that that was what I'd receive back for my pension.
So from what I read, I'm legally obligated to pay the money for the medical insurance since the companies are linked. That's what I was looking to hear because I just had no idea if this was true or not. It makes sense, but my boss clearly doesn't have things organized properly so her pulling this out just before I leave to get some money from me, I hope you guys can see, it might've looked like a bit of a scam.
I had understood that it was illegal to not have medical insurance (I have Canadian medical insurance) while here as an E-2 but I have some friends who aren't covered under it but also don't get a pension refund. IN that case, I was just confused about what the deal was. Basically, my boss never should've "asked" me if I want medical insurance. Actually, the teachers before me found out at the end of the contract that she just refused to get medical insurance for them for the entire year without them knowing.
And on that note, you can clearly see how good this school is.
it's EHWA American Language School, Banlim-dong in Changwon.
I have an entire list of things that have happened this year with the boss, if anyone wants info you can PM me.
Again though, THANKS EVERYONE, I greatly appreciate your help. |
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hogwonguy1979
Joined: 22 Dec 2003
Location: the racoon den
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| Posted: Fri Aug 26, 2011 8:47 pm Post subject: |
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glad you are getting something back but still something doesnt seem right, if she enrolled you in the national pension scheme, i think its automatic you get enrolled in nhic, thought its been that way since around 2004.
regarding the independent contractor thing, again the employer is lying to immig. they are required to tell immig they will enroll you in it as part of them procuring the e2 confirm number, the govt doesnt want foreigners here without health insurance (see Bill Kapoun story), whether employers are doing this is another story. yes there are a bunch of people here on e2 as independent contractors but they shouldnt be. its a way for employers to save around 6% of a salary that they dont have to pay into nhic and pension. if i was a betting man i wouldnt bet those on that status are making 6% more than a typical worker |
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ontheway
Joined: 24 Aug 2005
Location: Somewhere under the rainbow...
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| Posted: Sat Aug 27, 2011 10:16 am Post subject: |
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| hogwonguy1979 wrote: |
glad you are getting something back but still something doesnt seem right, if she enrolled you in the national pension scheme, i think its automatic you get enrolled in nhic, thought its been that way since around 2004.
regarding the independent contractor thing, again the employer is lying to immig. they are required to tell immig they will enroll you in it as part of them procuring the e2 confirm number, the govt doesnt want foreigners here without health insurance (see Bill Kapoun story), whether employers are doing this is another story. yes there are a bunch of people here on e2 as independent contractors but they shouldnt be. its a way for employers to save around 6% of a salary that they dont have to pay into nhic and pension. if i was a betting man i wouldnt bet those on that status are making 6% more than a typical worker |
The above is so misleading and false it must be corrected.
1) National Pension and National Health Insurance involves two separate processes. Your employer must enroll you in each of them, one at a time. If you are an independent contractor, you must enroll yourself in each, one at a time. They are linked only in the sense that they check their rosters against the other agency to look for discrepancies and find scofflaws.
This separate enrollment will not change. Some individuals have alternate retirement arrangements that make them exempt, legally, from the National Pension Scheme, but they still need to sign up for health insurance. There is a long list of exempt groups. Since this rule was made to benefit Koreans primarily, and the necessity of separate enrollment is necessary for Koreans, the plight of E2 visa holders is not going to change the system. In any case, many E2 visa holders are legally exempt from National Pension as well, for a variety of reasons. So, they only need to sign up for health insurance.
It is also possible for other individuals to have a reverse set up and enroll in National Pension while being exempt from national health insurance.
2) Your sponsor for your E2 visa does not make any promise to Immigration that they will enroll you in the national pension or national health insurance. You can legally work as an independent contractor in Korea. This is NOT a decision that is up to the Immigration office. It is not under their jurisdiction. They have no authority under Korean law to require that your sponsor enroll you.
The Korean Immigration office does NOT make the rules as to who is or is not an Independent contractor in Korea. They have no say in the matter.
It is legal for E2 visa holders to work as Independent contractors in Korea, at the present time. This could change. It probably will not since multiple job holders would have to pay for multiple enrollments.
However, the law could be changed to require that the primary place of work of an E2 visa holder be required to hire the E2 visa holder as an employee, under an employer/employee relationship and to enroll the E2 visa holder as an employee in the appropriate government sponsored programs including: income tax withholding, national pension and national health insurance. However, although such an act would be positive for many E2 visa holders, it would have negative consequences for some. |
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World Traveler
Joined: 29 May 2009
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| Posted: Sat Aug 27, 2011 12:44 pm Post subject: |
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| World Traveler wrote: |
| (At least one poster on here claims it is legal for an E-2 to be an independent contractor.) |
Now that I think of it, the only person on here claiming it is legal for an E-2 to be an independent contractor is ontheway. And he has a very pro-business owner point of view. (I'm still not sure of the truth: confused as to what it is.)
| ontheway wrote: |
Minimum wage is one of the most detrimental programs ever devised.
Minimum wage means that those worth less than the minimum remain unemployed. It does not mean that employers raise their pay.
Minimum wage causes those with poor work skills to become a permanent underclass. With long periods of or even permanent unemployment.
Minimum wage causes taxes to rise on other workers to pay for welare benefits for those harmed by the minimum wage.
Minimum wage slows economic growth and development and reduces the standard of living of all by preventing those with lesser skill levels from entering the economy and improving their marketability over time.
and most perversely of all, Minimum wage causes those who are employed and working at or narrowly above the established minimum to earn less than they would without the minimum since the minimum wage itself sets a standard that has the effect of neutralizing the competitive effects of the labor market. Minimum wage establishes a psychologically regulated marketplace for workers that causes millions to work for less than they are worth. In essence, the government becomes a monopoly provider of cheap labor to fill low skilled jobs.
So, yes, massive prosperity will follow automatically from the elimination of the fascist-socialist progams endorsed by those who have no concept of the reality of the economic world and how it works. Economics is a hard science with immutable laws understood by few. |
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ontheway
Joined: 24 Aug 2005
Location: Somewhere under the rainbow...
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| Posted: Sat Aug 27, 2011 3:04 pm Post subject: |
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| World Traveler wrote: |
| World Traveler wrote: |
| (At least one poster on here claims it is legal for an E-2 to be an independent contractor.) |
Now that I think of it, the only person on here claiming it is legal for an E-2 to be an independent contractor is ontheway. And he has a very pro-business owner point of view. (I'm still not sure of the truth: confused as to what it is.)
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If you are confused it's because you do not like to face facts. You have an idea of the way you wish things would be and so you are hoping that someone will tell you that your fantasies and dreams have come true.
I have given you the facts:
1) Enrollment is separate. (Go down to the offices and check.)
2) People can be legally exempt from Pension. (for E2s: South Africans, persons over age 60, some University positions among others for Koreans: dozens of other catagories)
3) The rules were made for the benefit of Korean citizens and will not be changed just for a few E2 problems.
4) When properly carried out, the Independent contractor status is legal for E2s. All government offices know it's done and which big employers are doing it. If it were NOT legal, they would be ordered to stop. No such order can be given, because it's legal. That's why some former CDI worers had to file a lawsuit - because the status at present is legal, if your contract is properly formulated.
5) The Independent contractor status is not under the purview of the Immigration office. They cannot legally make or change the rules.
6) This issue has nothing to do with the minimum wage, which is also NOT under the purview of the Immigration office.
Facts are facts.
Go ask them. |
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ontheway
Joined: 24 Aug 2005
Location: Somewhere under the rainbow...
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| Posted: Sat Aug 27, 2011 3:14 pm Post subject: |
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| hypemo7 wrote: |
Thanks for the input guys, I really had no idea what the deal was for this whole thing and I'm sorry that I wasn't more clear in my original post.
My pension was paid into and sorted out for the lump sum payment yesterday, my boss wrote down a number around 1.4 mil and told me that that was what I'd receive back for my pension.
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Back to the OP.
1.4 million won sounds a bit short for your pension payout.
If you make 2 million per month, and both employer and employee make the required deductions and payments for a year (usually 11 months of payments are required in your first year and not 12) you should be getting around 2 million won back.
You and your boss should each have paid approximately 4.5% per month toward the Pension. Your amounts should be the same.
Did you actually go to the pension office and fill out the paperwork yourself for your refund?
Did you arrange for the money to be sent to your bank account?
This pension refund does not come from your employer, and your employer cannot normally make the arrangements for a refund without you being there. The money is never refunded to you by your employer. It comes from the Pension office. If your boss is giving you the "pension refund" then possibly no money was ever paid in, and this could explain why you're short. It would also lead one to suspect that the insurance money you are going to pay at the last minute will not be paid to the national insurance program. If your refund is coming from the Pension office, you worked a whole year and made at least 2 mil per month, then I wonder why you're short on the refund. |
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sojusucks
Joined: 31 May 2008
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| Posted: Sat Aug 27, 2011 3:38 pm Post subject: |
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| OP, go to the national health insurance office, and insist that your boss come along with you. |
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