Observation (CEACR) - adopted 2022, published 111st ILC session (2023)

Employment Policy Convention, 1964 (No. 122) - Republic of Korea (Ratification: 1992)

The Committee notes the observations of the Korea Enterprises Federation (KEF) submitted with the Government’s 2019 and 2020 reports and the Government’s responses thereto. The Committee also notes the observations of the Korean Confederation of Trade Unions (KCTU) received on 20 September 2019. The Government is requested to provide its comments in this respect.

Articles 1 and 2 of the Convention. Overall labour market trends. The Committee notes the information provided by the Government on labour market trends, indicating that the labour participation rate for persons 15 to 64 years of age increased from 63.2 per cent in 2017 to 63.3 per cent in 2019. It adds that the overall employment rate for persons 15–64 increased year-on-year, from 66.6 per cent in 2017 to 66.8 per cent in 2019, whereas the overall unemployment rate increased slightly, from 3.7 per cent in 2017 to 3.8 per cent in 2019. The Committee notes that, according to data available to the ILO Statistics Department (ILOSTAT), as of 2021, the labour participation rate had declined only slightly from 2019 pre-pandemic levels, reaching 63.1 per cent (72.7 per cent men and 53.7 per cent women). It also notes that, while the overall unemployment rate remained relatively stable, declining to 3.6 per cent from 2019 to 2021, the unemployment rate for young persons aged 15-24 in 2021 was more than twice as high as that of the 15-64 age bracket, reaching 8.1 per cent during this period. In respect of active labour market measures, the Government refers to the adoption of the Plan to Develop Public Employment Service in June 2019. Currently, there are 989 public employment service centres operated by eight ministries and an additional 232 centres operated by local governments. In addition, a plan to achieve innovation in vocational skills development was adopted in April 2019. The annual number of trainees among jobseekers and unemployed persons participating in vocational training programmes was 280,000 in 2019, while the number of employed persons participating in such programmes was 294,000. The Government indicates that the Minister of Employment and Labour formulates a basic employment policy plan every five years in accordance with the Basic Employment Policy Act. The Committee requests the Government to continue to provide comprehensive updated information on overall labour market trends, including statistical data disaggregated by sex and age, relating to employment, unemployment and underemployment. It further requests the Government to continue to provide detailed updated information regarding the nature, scope and impact of active labour market measures implemented to promote full, productive and freely chosen employment in the Republic of Korea.

Measures addressing dualism in the labour market. The Government reports that the share of non-regular workers among wage workers increased by 3.9 per cent from 32.5 per cent in 2013 to 36.4 per cent in 2019. Among non-regular workers, the number of temporary and part-time workers increased, while the number of non-standard workers, such as dispatched and agency workers decreased. The Committee notes that the Policy Directions for Referral Workers in the Private Sector were adopted and came into force on 4 December 2019. Moreover, the Committee notes that, in the private sector, the Government provides subsidies to small and micro enterprises (SMEs) to assist them in converting non-regular workers into regular workers. The proportion of voluntary non-regular workers also increased. In this respect, the Committee notes the information provided by the Government on the measures taken to convert non-regular workers in the public sector into regular workers. As of May 2020, the converting process for 181,000 non-regular workers reached 95.4 per cent of the target number of 205,000. Moreover, in smaller organizations, 5,743 out of 6,195 non-regular workers were converted to regular status. Moreover, in the private sector, the Government provides subsidies to small and micro enterprises (SMEs) to assist them in converting non-regular workers into regular workers. However, the Committee notes that the Government does not provide information on the status of the proposed amendments to the Act on the Protection of Dispatched Workers. It notes that, according to the observations of the KCTU, a significant percentage of non-regular workers in the public sector were converted to regular status by newly established subsidiaries of public institutes, whose main function is to hire these workers to work for their parent companies. The KCTU points out that this leaves the converted workers in triangular employment relationships, in which they are classified as a category separate from that of regular workers and subject to a different system of wages. The KCTU expresses the view that the policy support provided by the Government to promote the voluntary conversion of non-regular workers in the private sector to regular workers to be limited and short-term in nature. The Committee notes that, according to the 2021 OECD Inclusive Growth Review of Korea: Creating Opportunities for All, despite the Government’s efforts, labour market dualism remains a key challenge. The report indicates that the proportion of non-regular workers remains high, with women, young persons and older workers being disproportionately employed in non-regular employment, where they earn approximately one-third less than regular workers. Only 70.8 per cent of non-regular workers are covered by unemployment insurance. Temporary workers earn less than 60 per cent of the hourly wage of a regular worker and have lower probabilities of moving into regular employment than unemployed persons. In this context, the Committee notes that the Government does not provide information on the status of the proposed amendments to the Act on the Protection of Dispatched Workers. In addition, the Committee notes the observations of the KCTU, in which it notes that the Government’s efforts to promote flexible working hours is one of the main reasons for the low-wage structure in Korea, leading to a decline in the quality of employment. It adds that, despite efforts made to reduce working hours in recent years, this has been offset by employers’ recourse to flexible hours and special exceptions which allow employers in specific industries to have workers continue to work beyond the legally permitted maximum hours and/or to change the length of their breaks. The Committee requests the Government to intensify its efforts to reduce labour market dualism in both public and private sector with a view to creating full, productive and lasting employment opportunities for both regular and non-regular workers. It also requests the Government to continue to provide detailed updated information on progress made or results achieved in this regard, including information on the status of the amendments to the Act on the Protection of Dispatched Workers. In addition, the Committee requests the Government to indicate the measures taken to address the concerns raised by the Korean Confederation of Trade Unions (KCTU) with respect to the wage structure, working hours and quality of jobs in the industries eligible for special exceptions.

Job creation policy and the COVID-19 pandemic. The Committee notes the Government’s indication that the “Five-year Job Policy Roadmap” was adopted in October 2017, establishing job creation as a national priority. As implementing measures taken under the Roadmap, the employment rate and the number of the employed for the overall population increased. The Government nevertheless indicates that the country is facing economic recession and employment shock due to the COVID-19 pandemic. In response to the difficulties in the labour market, the Government invested approximately 12 trillion won to develop and actively carry out additional measures to stabilize employment and create jobs, by expanding employee retention subsidy, designating sectors to receive special employment support, deferring the deadline for social insurance contributions, introducing emergency employment stability subsidies, a loan for the employment retention fund and providing subsidies under labour-management agreements to maintain employment. In addition, the Government established and implemented the “Korea New Deal Initiative” in July 2020 to protect jobs and to support domestic demand. In particular, the Initiative aims to expand the employment and social safety net to better protect those who are particularly vulnerable in time of crisis. The KEF indicates in its observations that, although the government estimates that employment indicators such as the employment-to-population ratio continue to improve since various measures to support employment have been implemented, the number of employed persons has been decreasing since the pandemic began. Noting the difficulties in labour market due to the COVID-19 pandemic, the Committee requests the Government to continue its efforts to create full, productive and sustainable employment opportunities for all, particularly the most vulnerable during the crisis. It also requests the Government to continue to provide information on the nature of the measures taken and results achieved in this regard. The Committee also requests the Government to provide information on the role of the social partners during the development and implementation of these measures.

Youth employment. The Committee notes that, according to the observations of the KEF, it is necessary to improve the assessment of the employment impact of the measures taken in respect of youth employment, and to better manage and monitor the existing subsidies, such as allowances for young job seekers, so that they are used for their purpose. The Committee notes the Government’s response to the KEF’s observations, indicating that it recognizes the recent rise in the extended unemployment rate of young persons, from 21.7 per cent in 2016 to 23.8 per cent in 2019, and that market response to measures taken is lagging behind actual progress. The Government indicates that there has nevertheless been continuous improvement of the youth employment indicators year on year. It adds that the youth unemployment rate also shows an overall decreasing trend despite some fluctuations. The Government further states that it is facing the biggest challenge to youth employment over the next three to four years due to demographic changes, with a large number of young persons entering labour market. To address this challenge, a youth employment strategy was developed in March 2018, focusing on providing strong incentives for companies to hire young persons and addressing problems in the job-seeking process. The Government also refers to the implementation of various initiatives, including the K-Digital Training Programme, to provide training through business, universities and institutions equipped with innovative technologies and training capacity, with the aim of fostering 180,000 young persons in high-tech industries. In particular, tailored vocational training and employment support are provided to youth not in employment, education or training through the Naeil Irum (achieve tomorrow) School Programme. The Committee notes that, on 27 August 2021, the Government introduced amendments to the Special Act on the Protection of Youth Employment, which extended the regulations on the employment of unemployed youth in public institutions for a two-year period. Pursuant to section 5 of the Special Act, public institutions are required to employ unemployed young persons (15-34), who must constitute 3 per cent of their total workforce. The Committee also notes steps taken by the Government to diversify the programmes offered by the Youth Advancement Support Project, which supports young persons who have given up on finding a job or are experiencing job anxiety and depression, as well as the Youth Job Leap Incentive, which provides support to SMEs to encourage them to employ young people facing difficulties in entering the labour market. In the context of the COVID-19 crisis, the Government increased the number of recipients of the youth job search allowance from 50,000 to 100,000 persons and the employment success package program from 50,000 to 130,000 persons. Additional budgets have also been allocated through the additional youth employment subsidy program, providing support to 90,000 persons. Noting the increasing number of young persons seeking to enter the labour market, the Committee requests the Government to strengthen its efforts to promote the long-term integration of young persons in the labour market, including educated young persons and other categories of young people who encounter difficulties in finding employment. It also requests the Government to continue to provide information on the measures taken or envisaged in this regard, as well as any progress made or results achieved.

Employment of women. The Committee notes the information provided by the Government on the adoption of the 6th Basic Plan for Equal Employment to improve the quantity and quality of employment of women in December 2017 and its implementation, by providing systematic support for maternity protection, promoting a discrimination-free working environment and supporting work-life balance. Various measures are being taken under the 6th Basic Plan, such as extending the scope of application of the Equal Employment Opportunity Act to all workplaces, strengthening protection and monitoring of sexual harassment at work, imposing obligations on employers to address the gender wage gap, promoting education that is free of gender stereotypes, providing re-employment support for women whose careers have been interrupted, as well as increasing parental leave benefits and extending the paid paternity leave from 3 days to 10 days. The Committee also notes the Government’s indication that the employment rate of women is continuously increasing, notably among women in their 30s, from 55.5 per cent in 2013 to 60.7 per cent in 2019. However, the Committee notes that, despite the reduced gap, the overall employment rate of women 15 to 64 is still significantly lower than that of their male counterparts, increasing from 70.7 per cent in 2019 to 72.7 per cent in 2021 for men and from 51.6 per cent in 2019 to 53.7 per cent in 2021 for women. The Committee further notes that, according to the observations of the KCTU, women account for 55.6 per cent of all non-regular workers and this proportion has been steadily increasing since 2003. The KCTU indicates that, after their job breaks due to marriage and pregnancy, women re-enter the labor market through precarious and irregular jobs, working for limited terms or in part time in cleaning, domestic work and service jobs. The Committee notes that, according to the 2021 OECD report, while the gender wage gap has declined significantly since 1992, from 47 per cent in 1992 to 32 per cent in 2019, at 32 per cent it is still the highest among the OECD countries. Against this backdrop, the Committee notes that, pursuant to the revision of the Gender Equality Act and the Labour Relations Commission Act adopted on 21 May 2021, the Labour Relations Commission Correction system to Address Gender Discrimination in Employment came into effect on 19 May 2022. In addition to imposing penalties on employers for gender discrimination in employment, the correction system allows workers who have been subjected to discrimination to apply for and receive redress, including improvement of working conditions and appropriate compensation. The Committee requests the Government to strengthen its efforts to increase women’s participation in the labour market, particularly in full, productive and sustainable employment, and to provide updated comprehensive information on the nature and impact of measures taken. Recalling its previous comments regarding the Workers with Family Responsibilities Convention, 1981 (No. 156), the Committee also requests the Government to continue to provide information on measures taken or envisaged to assist both female and male workers to reconcile their work and family responsibilities.

Employment of older workers. The Committee previously noted that retired employees continue to work in non-regular and part-time positions until their late sixties due to an inadequate social safety net, and that measures were taken to strengthen the outplacement and re-employment services to older workers with lifetime planning and vocational skills, including through the wage peak system. The Committee notes the Government’s indication that an analysis of the employment effect of the subsidy for employing older workers and the mid-long term policy direction for employment stability of older workers, carried out by the Korea Labour Institute in 2017, shows that the wage peak system has an overall positive impact on employment of older workers. The Government also indicates that tailored training programmes are provided to older workers, however, it is hard to measure the number of persons placed in employment as a result of the customized training, due to the lack of accumulated data samples of trainees. The Committee also notes that the statistic information provided by the Government shows an overall increase from 2013 to 2018 in the employment rate of older workers, from 73.2 per cent to 75.2 per cent among those aged 50-59 and from 38.4 per cent to 40.1 per cent among those aged 60 and over. The Committee notes that, according to the 2021 OECD report, at 34 per cent, the employment rate of workers over 65 in Korea is twice the OECD average. The report also notes, however, that low job quality for older Koreans remains a significant challenge, with many retired workers finding new employment in precarious and low-paid jobs, or in self-employment. The 2021 OECD report notes that Korea is well above the OECD average, reaching 45.7 per cent of those over 65 years of age. The Committee requests the Government to continue to provide detailed information on the measures taken to promote productive employment opportunities for older workers and their outcomes. It also requests the Government to continue to provide statistical information on employment creation, job placement results and income levels of older workers.

Migrant workers. The Committee notes the absence of information in this regard. Recalling its previous comments under the Discrimination (Employment and Occupation) Convention, 1958 (No. 111), the Committee once again requests the Government to provide information on the situation of migrant workers in the labour market.

Article 3. Participation of the social partners. Following its previous comments, the Committee notes the Government’s indication that social partners participate in the formulation and implementation of employment policies through meetings held within various tripartite structures. In particular, the ESLC was established in November 2018. A tripartite joint implementation monitoring group was formed at the ESLC to monitor the implementation of the Tripartite Jobs Pact. In July 2020, a tripartite agreement was concluded to overcome the COVID-19 crisis through the ESLC aiming to maintain jobs. The implementation of this agreement is monitored by a special committee established in August 2020. The Committee requests the Government to continue to provide information on consultations held with the social partners on the matters covered by the Convention. It also requests the Government to provide detailed information on consultations held with representatives of the persons affected by employment policy measures, and representatives of workers in non-standard forms of employment.