Statutory employment insurance premium rate to be raised by 0.3% effective from October 1, 2019
l Statutory employment insurance premium rate to be raised by 0.3% effective from October 1, 2019
Premium rate for statutory unemployment insurance will be raised by 0.3% from 1.3% to 1.6% effective from October 1, 2019.
|
Before |
October 1, 2019 and thereafter |
||
|
employee portion |
employer portion |
employee portion |
employer portion |
|
0.65% |
0.65% ~ 1.25% |
0.80% |
0.8% ~ 1.40% |
As a result of the rapid increase in payout of unemployment benefits to the unemployed in the wake of the business recession, the unemployment benefit reserves have hovered below the level prescribed in Article 84 of the Employment Insurance Act (the reserves of Won 5.5 trillion may be exhausted in the next five years by 2024 without insurance premium rate increase). This means that even if employees lose their jobs, there will be no fund available to pay for their employment benefits. This made it inevitable for the Korean government to raise employment insurance premiums.