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KnowlesRds
Joined: 18 Jan 2016
Location: Bupyeong-gu, Incheon
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 Posted: Sun Jul 24, 2016 10:19 pm Post subject: No Pension, Private Insurance -I think my employer is sketch |
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I have worked at a Hagwon with an E2 visa for the past 7 months and I have 3 questions that have to do with insurance, pension and taxes. The questions are the following:
A. Insurance:
From what I read, providing insurance is a MUST for all E2 employees. However, is government insurance required? I ask because I have recently found out that I have private insurance that doesn't necessarily cover much. Example, my insurance does not cover dental, a physical check up with a primary physician or even an eye test with an optometrist. Is this Kosher?
B. Pension:
My understanding is that it is ABSOLUTELY ILLEGAL for an employer to not make the necessary contributions towards your pension and to not make the pension withholdings from your monthly (4.2%) payment. I have checked my paystubs and not one of them have ANY mention about a withholding or contribution towards a pension (where it clearly states so for my insurance.)
C. Taxes:
It has come to my attention after reading the following post on Reddit (https://www.reddit.com/r/korea/comments/4jf5hu/horrible_hagwon_ccle_and_advice/). In it, the OP mentioned something sketch about a 3.3% tax withholding. It turns out that my payslips indeed have this same exact figure. According to the OP, this is something employers do to tip-toe around paying the proper taxes, pension and insurance.
My question is two parts: is EVERYTHING on the up-and-up and if it's not, what can I do about it to (hopefully) rectify the situation so that I can stop being ripped off on my taxes and see my pension at the end of my contract period and be able to enjoy the relatively cheap (compared to the States) medical costs in this country?
Essentially, what can I expect (realistically) as an outcome? |
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PRagic
Joined: 24 Feb 2006
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| Posted: Sun Jul 24, 2016 10:43 pm Post subject: |
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Check to see if you're listed as a permanent employee or as a 'contractor'. From your description, it would seem that they have you registered as a contractor, and that obsolves them from the obligations you're seeking.
If you're a 'contractor' then they don't have to pay into all that. In fact, if you're a contractor and they provide any insurance, they're not doing so because they have to.
Ttompatz should be able to set you right. The big question is whether or not they can get you an E2 visa, but then still register you as a contractor. That would be a no-no. Or are you a Kyopo on an F-series visa? In which case, you may have just signed a contract thinking you were being registered as a full-time employee (but aren't). |
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ttompatz
Joined: 05 Sep 2005
Location: Kwangju, South Korea
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| Posted: Mon Jul 25, 2016 3:58 pm Post subject: Re: No Pension, Private Insurance -I think my employer is sk |
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| KnowlesRds wrote: |
I have worked at a Hagwon with an E2 visa for the past 7 months and I have 3 questions that have to do with insurance, pension and taxes. The questions are the following:
A. Insurance:
From what I read, providing insurance is a MUST for all E2 employees. However, is government insurance required? I ask because I have recently found out that I have private insurance that doesn't necessarily cover much. Example, my insurance does not cover dental, a physical check up with a primary physician or even an eye test with an optometrist. Is this Kosher?
B. Pension:
My understanding is that it is ABSOLUTELY ILLEGAL for an employer to not make the necessary contributions towards your pension and to not make the pension withholdings from your monthly (4.2%) payment. I have checked my paystubs and not one of them have ANY mention about a withholding or contribution towards a pension (where it clearly states so for my insurance.)
C. Taxes:
It has come to my attention after reading the following post on Reddit (https://www.reddit.com/r/korea/comments/4jf5hu/horrible_hagwon_ccle_and_advice/). In it, the OP mentioned something sketch about a 3.3% tax withholding. It turns out that my payslips indeed have this same exact figure. According to the OP, this is something employers do to tip-toe around paying the proper taxes, pension and insurance.
My question is two parts: is EVERYTHING on the up-and-up and if it's not, what can I do about it to (hopefully) rectify the situation so that I can stop being ripped off on my taxes and see my pension at the end of my contract period and be able to enjoy the relatively cheap (compared to the States) medical costs in this country?
Essentially, what can I expect (realistically) as an outcome? |
The process is sketchy.
As an "employee" you are being taxed at about double the going rate.
National Health Insurance is required by all employees. If they catch you at some future point you will be liable for payment of all unpaid back premiums from the time of your entry on your current ARC to the time they catch you.
The rate is about 3% each for you and your employer.
If you are NOT from South Africa then you are also requried, as an employee, to be registered with the NPS. You pay 4.5% of your salary and that is matched by your employer. If you are from Canada, Aus, or the US you can get a lump sum payout when you leave Korea. If you are from elsewhere then you get your pension when you turn 65.
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greyhound
Joined: 10 Jun 2016
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| Posted: Mon Jul 25, 2016 4:05 pm Post subject: |
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| Do you get a pension if you are from the UK? Some American said you can't get it or something as the UK haven't signed up properly. I know I am going to be paid pension by my employer however. |
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candy bar
Joined: 03 Dec 2012
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| Posted: Mon Jul 25, 2016 8:10 pm Post subject: |
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| greyhound wrote: |
| Do you get a pension if you are from the UK? Some American said you can't get it or something as the UK haven't signed up properly. I know I am going to be paid pension by my employer however. |
Your employer will deduct 4.5% of your salary for pension. |
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Aine1979
Joined: 20 Jan 2013
Location: Incheon
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| Posted: Mon Jul 25, 2016 10:41 pm Post subject: |
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| greyhound wrote: |
| Do you get a pension if you are from the UK? Some American said you can't get it or something as the UK haven't signed up properly. I know I am going to be paid pension by my employer however. |
Your employer will deduct 4.5% of your salary for pension. They will match this in payments to the pension office. Americans (and I think a few other nationalities) can collect their pension payments in a lump sum when they leave Korea, as the US allows Koreans to do the same. Basically they get back twice what they paid in, the 4.5% they paid, plus the 4.5% their employer paid in.
The UK and Ireland don't allow Koreans to collect their pension payments in a lump sum when they leave, so Korea doesn't allow people from the UK or Ireland to do the same. If you've made at least 10 years of pension payments, then once you turn 65 you can collect your pension in Korea.
Unfortunately, unless the UK changes its pension arrangement with Korea, while you will pay 4.5% of your salary every month, it's unlikely you'll ever see it again. So you won't be paid pension by your employer, you will pay half of it and they will pay half. |
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candy bar
Joined: 03 Dec 2012
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| Posted: Mon Jul 25, 2016 10:51 pm Post subject: |
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| 4.5% down the drain. Say adios to 100.000 every month. |
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trueblue
Joined: 15 Jun 2014
Location: In between the lines
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| Posted: Tue Jul 26, 2016 3:12 am Post subject: |
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Here is question...and O.P., I do apologize, I don't mean to de-rail your thread, but this may come in handy for others.
What if...
A. You know your employer is underreporting your salary.
B. Your employer is taking out 3.3% for income tax (being an "employee")
C. Based on A and B, you know your pension contribution taken out by the school, and, what they contribute is lower. So, when you collect I n the end may be lacking roughly 700,000 won?
...Is it worth the battle? |
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victorflood
Joined: 19 Nov 2015
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| Posted: Tue Aug 02, 2016 4:28 pm Post subject: |
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| greyhound wrote: |
| Do you get a pension if you are from the UK? Some American said you can't get it or something as the UK haven't signed up properly. I know I am going to be paid pension by my employer however. |
hahahahahaha! |
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ttompatz
Joined: 05 Sep 2005
Location: Kwangju, South Korea
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| Posted: Wed Aug 03, 2016 1:32 am Post subject: |
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| trueblue wrote: |
Here is question...and O.P., I do apologize, I don't mean to de-rail your thread, but this may come in handy for others.
What if...
A. You know your employer is underreporting your salary.
B. Your employer is taking out 3.3% for income tax (being an "employee")
C. Based on A and B, you know your pension contribution taken out by the school, and, what they contribute is lower. So, when you collect I n the end may be lacking roughly 700,000 won?
...Is it worth the battle? |
Not until you are ending your contract, have collected your severance and have a while to stay in Korea (like at a new job).
Filing the complaint before you are leaving that employer will likely mean loss of employment and all of the headaches that come with that when you are on an E2 in Korea.
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