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  • Job stability funds program to be implemented from Jan. 2018
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  • Dec. 20, 2017

     

    The job stability funds program, a solution to ease the cost burden caused by the minimum wage hike, will be implemented starting January 2018.

     

    At the 11th ministerial meeting on the economy held on December 20th (Wed.), the government decided to receive applications for job stability funds from January 2nd, 2018 and make actual payments from February 1st, 2018.

     

    Ever since the announcement of the 'plan to implement the job stability funds program' on November 9th, 2017, the government has made thorough preparations to ensure a smooth implementation of the job stability funds program, especially spurred by the passage of the proposed budget for 2018 on December 6th.

     

    Application receiving agencies - Korea Workers' Compensation and Welfare Service, National Pension Corporation, National Health Insurance Corporation, MOEL's Job Centers and local governments' community service centers - have established a hotline among themselves and assigned dedicated personnel and counters.

     

    * The relevant government agencies set up their own dedicated teams, such as job stability funds teams in MOEL's local offices.

     

    The development of related electronic networks, including online application systems (Jan. 2, 2018~) and the job stability funds website (www.jobfunds.or.kr, Dec. 22~), is going smoothly, too.

     

    Other matters necessary for implementation, including modifying related laws and regulations, conducting PR campaigns tailored for micro-entrepreneurs and training personnel in charge, have been checked without omission.

     

    Government agencies and institutions related to the job stability funds program have also devised various measures through close consultation to ensure that all employers in need of job stability funds can conveniently benefit from the program.

     

    For a start, in addition to online application systems, 4,000 application counters have been set up in social insurance corporations' local offices, MOEL's Job Centers, local governments' community service centers, etc., across the country to allow employers to apply for job stability funds without any inconvenience.

     

    Employers can apply online via the job stability funds website (due to be launched on Dec. 22), the websites of the corporations responsible for the four social insurance schemes - COMWEL, National Health Insurance Corporation and National Pension Corporation - or MOEL's website.

     

    They can also apply offline by submitting applications to the nearest local office of any of the social insurance corporations, Job Center or community service center in person or by mail or fax.

     

    * about 4,000 application counters in COMWEL's 56 local offices, NHIC's 178 local offices, NPC's 109 local offices, MOEL's 94 Job Centers, local governments' 3,503 community service centers (2016), etc.

     

    In order to relieve the burden on micro-entrepreneurs who have difficulty in applying for job stability funds on their own, insurance service agencies will apply for the subsidy on behalf of micro-entrepreneurs without charging any fee.

     

    * Employment insurance service agencies which look after companies' employment insurance affairs free of charge will do the job of applying for job stability funds on behalf of micro-entrepreneurs.The 'insurance service agency search' service is offered on the job stability funds website (www.jobfunds.or.kr).

     

    The government has also come up with measures to largely reduce social insurance premiums for micro-entrepreneurs and SMEs, so that the job stability subsidies they can receive are not outweighed by their social insurance costs.

     

    Classification

    Main contents

    Duru Nuri Social Insurance Subsidy*

    If a worker is newly enrolled into the employment insurance or national pension scheme, a subsidy equivalent to 80~90% of his/her insurance premiums is provided.

    Workers in companies with fewer than 10 employees, who earn 1.9 million won or less a month, are eligible.

    Applications can be made online (www.4insure.or.kr) or offline (COMWEL, NPC).

    * For inquiries, contact COMWEL (1588-0075) or NPC (1355).

    Reduction in health insurance premiums*

    If a worker is newly enrolled into workplace-based health insurance, his/her health insurance premiums are reduced by 50%.

    Workers in companies with fewer than 30 employees, for whom job stability funds can be received, are eligible.

    The reduction is made automatically upon reporting the enrollment without requiring an application process.

    Social insurance premium tax credit

    Employers are granted a tax credit equivalent to 50% of their actual social insurance costs (excluding government subsidies, such as Duru Nuri subsidies and the reduction in health insurance premiums).

    This support is provided if an existing employee earning 100~120% of the minimum wage is newly enrolled into social insurance.

    Employers should apply for this tax credit when reporting their income for 2018 (Mar.~May, 2019).

     

    In the first quarter of next year, the government will provide a special voluntary reporting period for people not covered by any of the four social insurance schemes. If a person not covered by social insurance signs up for coverage during that period, he/she will be excused from paying a fine.

     

    The government will also has a special period from late December 2017 to February 2018 during the intial phase of the job stability funds program to promote applications and to ensure a soft landing of the program without trials and errors.

     

    An on-site monitoring team set up jointly by relevant government agencies and dedicated regional units will operate to monitor the status of program preparation and execution and to promptly respond when problems arise.

     

    The government aims to ensure that job stability funds serve as a pump-priming stimulus for income-driven growth and can ease business difficulties for micro-enterprises and employment insecurity for workers and increase the number of people covered by social insurance and thereby reinforce the social safety net.

     

    During the time left until the start of the program, the government will put every effort into making final-stage preparations, such as the operation of relevant government agencies' dedicated units and the complete establishment of the job stability funds system.

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