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Job seekers to get increased benefits, but few will qualify

South Korean job seekers will receive higher unemployment benefits for a longer period, but fewer will qualify for the benefits after the National Assembly passes a newly revised labor law.

According to the Labor Ministry’s latest report on the bill, the government aims to raise a job seeker’s unemployment allowance to 60 percent of his or her previous income before losing the job, from the current 50 percent. Once qualified, the job seeker would be able to receive the allowance for 120 to 270 days, whereas the payments are currently only doled out for 90 to 240 days.

However low a job seeker’s previous income was, she or he will be guaranteed to receive a minimum daily allowance of 40,176 won ($34.38), according to the Labor Ministry.
Korean job seekers look at job postings. (Yonhap)
Korean job seekers look at job postings. (Yonhap)

In spite of increased benefits, fewer job seekers will be qualified to earn the allowance if the bill is passed by the National Assembly.

The stricter eligibility criteria for the out-of-work benefit is to prevent possible abuses of the welfare system, such as switching jobs too often, the Labor Ministry said. 

Currently, one must have worked a minimum of 180 days in the course of 18 months before losing the job in order to claim the unemployment allowance. Once the revised bill takes effect, a job seeker will only be qualified to earn the benefits if he or she worked for a minimum of 270 days in the course of two years before becoming unemployed.

Those who receive the allowance more than three times in five years, or those who stay unemployed -- either voluntarily or involuntarily -- for more than 90 days after receiving the benefits will be specially monitored by the authorities.

While being monitored, they will be asked to actively engage in job searching at least once a week, while those who aren’t monitored are only required to do so once in two weeks.

Currently, those who fail to show up at mandatory job training sessions can lose up to one month’s worth of their unemployment allowance payments. The revised bill stipulates that those who don’t attend required training will lose a maximum of two months’ worth of their allowance payments. Job seekers who have received the allowance more than once and missed more than two training sessions can lose up to 30 percent of their payments, according to the report.

Meanwhile, elderly individuals who have lost a job in which they were initially employed at age 65 or older will be eligible to apply for out-of-work benefits should the bill take effect. Currently, the elderly in the specific circumstances are not qualified to earn the benefits. The Labor Ministry predicts that some 13,000 elderly workers, especially janitors and cleaners, will benefit from the revised bill when their work contract ends and they are looking to be employed elsewhere.

According to a study by the Labor Ministry, the vast majority of Korean job seekers do not apply for out-of-work benefits. The study, which looked at some 1,000 unemployed Koreans, showed that 88.7 percent did not claim the allowance. The largest portion of them, 48.7 percent, said it was because they found another job right away, while 26 percent said it was because they voluntarily left their jobs.

In Korea, jobseekers are eligible to apply for unemployment allowance only if they were forced to leave by their employers.

According to Kim Seong-eun from the Labor Ministry, some exceptions apply to those who voluntarily quit their jobs. “For example, if one quit his job because his office moved to another region and required him to commute for six hours a day, we’d consider him as someone who is qualified for the allowance,” he said.

Even if the new bill does take effect, those who voluntarily left work will have to file an additional application should they want to apply for the allowance, Kim said. Only those who had to quit their jobs because of unfortunate circumstances will be given the benefits, he said.

However, only 2 percent of all recipients of unemployment benefits were those who voluntarily left work but who were recognized by the government as deserving the allowance, as of 2012. Almost 50 percent of them were female workers who left work after becoming pregnant.

By Claire Lee (dyc@heraldcorp.com)
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