South Korea’s workforce is no stranger to the complexities that come with navigating employment benefits—none perhaps as intricate as the country’s “Four Major Insurances”: Industrial Accident Compensation Insurance, Employment Insurance, National Pension, and Health Insurance. For those in the Teaching English as a Foreign Language (TEFL) community in South Korea, understanding the nuances of these insurances during periods like maternity and parental leave becomes doubly crucial.
The Unseen Industrial Accident Compensation Insurance
Starting with Industrial Accident Compensation Insurance, this is a company’s liability, not an individual’s. You might not even see a line item on your pay stub dedicated to it. Whether you are on paid or unpaid maternity or parental leave, there’s zero obligation for you to contribute towards this insurance. The company bears the full cost—before, during, and after your leave.
The Ambiguities of Employment Insurance
When it comes to Employment Insurance, if your company does not pay you during your leave, there is no employment insurance fee to be deducted from your paycheck. However, the subtleties lie in the duration and type of leave.
During Maternity Leave
For example, if you are employed by a company that does not qualify as a “primary support target company,” Employment Insurance is only due for the initial 60 days of the 90-day maternity leave, based on the standard payroll deductions. After the initial 60 days, the remaining 30 days are funded by Employment Support Centers, and no employment insurance fee is required from you.
In contrast, if you work for a “primary support target company,” you don’t have to pay employment insurance fees during the entire 90-day maternity leave since the Employment Support Centers fund it all. However, if your company pays you an additional amount over the support provided by the Employment Support Centers, then an Employment Insurance fee calculated at 0.45% of the additional amount is due.
During Parental Leave
For parental leave, since you usually receive benefits from Employment Stability Centers rather than your employer, you do not have to pay Employment Insurance fees for this period.
The Case of National Pension Contributions
The National Pension is a different story altogether. By default, contributions are mandatory unless a specific exemption application is made. Should your company offer extra payments during your leave, the exemption is nullified, and you must pay the pension fee based on your regular salary.
Note that these exemptions are calendar-specific. If your leave begins on September 5, for instance, a pension contribution for the month of September would still be due.
Health Insurance: The Only Constant
Lastly, Health Insurance payments are mandatory throughout your leave, paid or unpaid. However, there is a ‘deferment’ option. In a month where you have no income, you can apply to defer your Health Insurance payment. This deferral is not an exemption; once you resume work and start receiving your salary, the deferred Health Insurance premiums become due in a lump sum.
The necessity for this stems from the fact that even during periods of leave, you are still entitled to use medical facilities under the Health Insurance scheme, making these contributions non-negotiable.
Navigating South Korea’s employment benefits during maternity and parental leave can be complicated, with conditions and exceptions aplenty. For the TEFL community operating within the Korean peninsula, grasping these nuances is not just beneficial but essential for financial planning during significant life events like childbirth and child-rearing. Understanding the rules now will help avoid future discord, offering a smoother, more predictable transition into the different phases of both your professional and personal life.
