Korean Job Discussion Forums

[Wisco Kid]

My employer is taking the entire 9% pension payment out of my salary instead of splitting 4.5% for my contribution and 4.5% for theirs.
When I asked about it, they said "you want to see the contract?".
I told them to forget it, cuz I already know what the contract says, and that is:
"pension will be deducted from the employee's salary": a very vauge statement with no figures or percentages.

It is clear to me that they are screwing me by getting around paying their share of the pension. The reason I ask if I should just play it cool and eat this amount is that they are very reasonable about everything else. I'm at the school from 1:20 to 8:55pm Mon-Fri. That time includes a 30 min dinner break and an easy 40min one-on-one class with the director's cousin that I get paid 17,000 of overtime per session. I also work 2 hours Sat evenings, for which I get paid 50,000 tax-free cash in hand. So before anything is deducted, I'm getting 2.4 mil per month if I work every saturday. They also pre-paid my arriving airfare (on a one-way ticket) no problems. Furthermore, past foriegn teachers and the current korean teachers have confirmed that the school has a history of not cheating staff.

I'm pretty sure that if I stick it out for the year I should have no problems getting the return flight and severence pay.
I'm I being smart or being a sucker?

[coolsage]

You might encounter this litany: 'Pension and severance are the the same thing'. They are not. Severance is the one-twelfth of one year's salary payable after one year's subservience. Pension consists of a percentage deduction from your monthly salary, matched by your employer, payable to you (depending upon your country of origin), upon leaving this country forever. You can 'cash out', i.e. take the lump sum, or roll it over into your country's reciprocal agreement with Korea (this is well dealt with in another thread), but by all means hold their feet to the fire on this one. Innumerable teachers have been ripped off on this one, and the money is going... into the pockets of the sleazy guys who know how to work the waygooks. Doesn't matter if these articles don't appear in your contract; it's the law of the land, which supersedes contracts. Get all that you deserve!

[J.B. Clamence]

It's pretty outrageous that they think they can get away with this just because there is no percentage figure in the contract. From what I understand (and someone please correct me if I'm wrong), they are required by law to match your payment. Whatever they take out from you, they have to put in an equal amount themselves. If they are so wonderful, why would they do such a slimy thing?

Also, if I were you, I would go to the pension office and request a copy of your pension statement to make sure that they're actually putting that money in your pension fund. If they're so bold as to make you pay the whole 9%, what's to stop them from stealing that money for themselves? Also, how are you so sure that they'll pay you severance and return airfare with "no problems" when they're pulling crap like this?

[saharzie]

2 hours on a Saturday for 25,000 won an hour is not a good deal.

[canuckistan]

[No L]

Are you an American or Canadian?

If you are, you can get your pension contributions back at the end of your contract. You won't be out any money, but you won't have gained either. I would consider accepting the deduction if this is the case. First check that the pension office is receiving the money as previously suggested.

If you're not, you can't get a pension refund and then you're probably losing 90 000 won or so a month. That's more than a million a year. That's a nice chunk of change. I wouldn't want to give it up.

[prairieboy]

The law requires the employer to match your contribution if there are 5 or more full-time employees at your place of work.

Otherwise, your maximum contribution is 4.5%. So if your employer is deducting 9% they shouldn't. They should either match your contribution of 4.5% or prove to the National Pension office that they have fewer than 5 full-time employees and get the contribution reduced that way.

At any rate, you should take the previous advice and check with the NPC to ensure payments are being made and to get clarification on the law as it applies to your workplace.

As for your contract...it cannot over rule the National Pension law, so it doesn't matter if your pension clause does not state that your employer will pay a portion of your pension. If your workplace meets the requirement for a matching contribution then that is the law. They can't get around it by showing your contract to the pension office and saying, "But he signed a contract that doesn't include an employer pension contribution." The must find a basis in the NPC law that gets them out of it.

Also, as stated, it's a good thing to consider your nationality. If you are American or Canadian it's not as big a deal as it would be if you are not. At least Americans and Canadians get their pension contributions and the employer contributions refunded. Kiwi's, Aussies and Brits do not, which means you are losing twice the money you would otherwise be losing (that is, if you intend to return to your home country eventually).

Cheers and good luck.

PS, if you don't know where your Pension office is, then call 1355. Be sure to have a Korean speaker help you out with the call.

[rapier]

Go to the EFL law website, and print up a copy of the law that states this.
Show it to them and insist that they match your contibution.
If they disagree, threaten to involve the labor board.
Simple.

However, it sounds more like a misunderstanding to me, as they are good in other respects- and a lot of employers don't fully know the laws.

[Son Deureo!]

[bellum99]

Does the school have more than 5 workers and are the others paying pension? If the school has less than 5 workers then he is just taking the money to pay you your severance. He is not required to pay the pension if the required number of employees is not working.
I think he had a good idea....he will make you pay your own severance.

[J.B. Clamence]

[Wisco Kid]

Thaks for all the advice.

I am american, just for the record. I'm actually not sure if my Hogwan officially has more than 5 full-time employees or not. I will definitely check up with the pension office and make sure everything is kosher. I'm under the impression that my employer doesn't think they're doing anything wrong, so they may just be ignorant of the law. For the time being, I'm gonna avoid a confrontation till I get all the facts straight. On a side note, my income tax was less than 40,000 won, which seems way lower than it should be for 1.9 mil. per month salary.

[nfarney]

This exact thing happened to me and here's what I did.

I'll tell you right now your director will not respond reasonably or favorably if you don't handle it right, and I'm not convinced there's a "right" way to handle it and salvage the relationship with your boss. Maybe my director is uniquely unreasonable, I don't know...

Its a long story, so I'll try to be as concise as possible. Just for the record my wife and I work at the same school so all this counts double for us--it works out to about US$1000 EACH at the end of the year.

FYI the pension office in Kangnam has a foreigner desk and there's never been a line. They are very helpful, but getting the right person is important, as you will see in my story. Be clear about your rights and communicate exactly what you want to accomplish to them BEFORE they contact your school.

First Pension office visit: I went to the pension office and showed them my paystub. They said "Yes, the correct amount is being deposited with us." (187,600) for a 2.mil salary range. I said "Yes, but they are witholding the full 9% from my gross pay!" They said "They can't do that, oh wow, that's bad!" and they called my school before I could say "Dont do that!" (They have your school info in their computer based on your residence card). Its a great scam because to the pension office, everything appears normal. The correct amount is being deposited by the school. Only the teacher can see that this scam is happening.

So I was thinking, uh oh my boss will be pissed, but my wife and I are up $2000. But my boss told the girl that us paying the full 9% was in the contract, which I had right there, and sure enough, the girl said, "Well, if its in the contract I can't do anything, sorry, but that's tough." (I'm paraphrasing throughout). (My contract does say I'll pay 9%--which ended up working in my favor later on, as its totally illegal).

So my boss is pissed and SUPER defensive and freaked out when I get back to the school ( I went to the pension office on my break). I apologized that she heard from the pension office first and not me, but explained that I still felt it was a fair question. "I'm sure there is a reasonable explanation...can you help me to understand it," I said.

From now on I am working under the premise that the law supersedes any contract (which it does).

Hours of meetings later, she was still trying to explain to me that there is a "loophole" that she was using that was actually better for the teachers, because our taxes were lower and we ended up getting more money in the end. The way she explained it made sense, but what she was explaining was illegal and basically saved her money at our expense. I said I would be satisfied if she could give me someone to contact or give me some resource to verify that the loophole she was using was legal and the best financial position for me. She said okay, okay and never did.

Meanwhile, I went back to the pension office three times, I went to the ministry of labour (who sent me to the pension office), I emailed EFL law twice, and I spoke to the Korea Help Center for foreigners near the Canadian embassy when I happened to walk past one day. ALL of these people had no clue that there was even the possibility of a loophole (I really wanted to know if there was a possibility before I pursued it any further). ALL of them said that she should refund my money and do the 4.5/4.5% payments. (My school has more than 5 full time employees, which is a requirement for all of this).

So after hours of discussions I told her I still could not agree with her and told her to expect another call from the pension office, and she could explain her loophole to them. If it satisfied them, it would satisfy me, I said.

The third time I went to the pension office, I got the right guy. He was so pissed when he heard my story and saw the 9% clause in my contract and he kept saying "shameful, shameful." He called up my school right there and anytime my director tried to explain her side of the story, he just rolled his eyes and got angrier and started talking again (more at her than to her).

So after 15 minutes of that, he hangs up, exasperated, and basically says, "She says she's taking the school out of the pension scheme." I asked "Can she do that?" He looks at me like "I guess she thinks she can" and says "No, but she is, apparently." I said, "And that means she should refund the money she's illegally witheld from us, right?" (I specifically told him I wanted this to happen before he called her). He said "Yes, definitely." Anyway, I have his name and phone number if you want it, but I'm sure you've already figured out that 15 minutes of being lectured didn't exactly make my boss's day...

Anyway, at the next meeting with my boss she said she would be paying us back in August or September (This all happened in June/July), but she didn't say anything to me about taking us out of the Pension Plan (what she told the pension guy).

Anyway, We are still in the National Pension, paying 4.5%, and we are getting refunded what was illegally witheld. I think that my bosses' "loophole" was illegal and she couldn't follow through on it, despite all her claims and threats to do it. I haven't followed up and checked with the Pension office to be sure the school is paying their 4.5%, but I'm assuming they are. I was planning to write up a big report about what happened to me with links and a guide of what to do if it happens to you, but was waiting for the refund from the school and the verification from the pension office before I did it.

One thing...I was warned by most of the people I spoke to about this that schools usually just fire teachers rather than deal with this stuff from them, and my boss was VERY touchy, and I'm still kind of nervous about it. I have a plan to deal with it if they try to screw me out of my severence or plane ticket, but I don't think I'll need it now..I've only got 2 months left and things seem to be cooling down. Anyway, its about $9000 out of her pocket when you count all the foreign teachers at our school. Have a plan to deal with getting fired, or recognize that they may try to force you out.

In our meetings she said things like "Well, if we're going to be "legal legal" about this, then we're going to be "legal legal" about everything in the contract, like get 2 notices and your fired." (which it does stipulate in the contract)...I got a written notice one week later for turning in a test that I made too late (a relatively minor offence, in my view, but "legal,legal" nonetheless). She also had really backward ideas about trust...after I said I think that trust is important in any relationship if its going to be good, she'd say "I also think trust and the relationship is more important than this amount of money...but since you are demanding that we pay you this money, the trust is broken" .....even though she was the one stealing from us and lying about it.

If you have a good relationship with your school, you've got to ask yourself, what's worth more: 97,000 Won a month or this good relationship. For me, its the money, just on principle, but from a practical standpoint, I really can't stand the people I work with anymore, and I am turning borderline racist against Korean culture. I can't wait to end this contract in 2 months. Even though they were screwing me, they aren't going to admit it. To them, I screwed them....the whole saving face thing, I think, and it sucks.

Also, six months ago I would have said my school was great and very honest, just as you are saying about your school. Its true they have never not paid severance and other teachers that have returned for a second year have been relatively happy with the school, aside from the normal cultural problems.

In the beginning I might have allowed that they were just ignorant of the laws (they were changed in the last 5-10 years), but after many impassioned discussions and explanations it reached a point (in my view) where they were either in DEEP pathological denial of obvious facts or they were deliberately confusing the issue and denying any wrongdoing to save money. Even now, I'm sure they believe they are doing me a favor by obeying the law and that I am in the wrong for "demanding" payment.

Anyway, PM me if you want some specific information. I know alot of stuff about where to go and who to talk to about this. On principle, I think everyone should stand up for themselves and stop people from taking advantage and ripping them off, but on a practical, individual level, it might not be worth it...up to each person, I guess.

I also had a friend who had a different pension problem, and he had the pension guys come right into the school and meet with his boss. They are very helpful to foreigners over there, but know what you want BEFORE you go in there.

[kylehawkins2000]

Yep, it's illegal regardless of what your contract states. Labor law overules your contract. Make them pay what they owe and make sure the money is actually making into the pension fund and not just into the director's pocket.

[pecan]

People often complain that Korean employers do not follow the letter of a contract, and now we have people complaining about employers following the letter of a contract.

Is whether it is legal or not the issue, or do you object to paying more?

Hypothetical...

If your employer did not mention anything about tax being removed from your pay in a contract, but the law required that tax be deducted, would you expect your employer to pay the tax, though you were legally obligated to do so?

It may not be your case, but it seems like people want it both ways. I can remember when a certain holiday did not have to be legally recognized by private institutes, and employees complaining that they should have the day off, though employers were not required to by law. Another was when an employer did not remove any of the tax until the last pay period, and the employee got all upset, though the deductions were legal.

Double standards?

Nut