|A System for Employment of Foreign Worker: Domestic Workers
Last month, the Chosun Ilbo, a daily newspaper in Korea, reported, “A babysitter becomes the superior of a working mother…Why not import babysitters from abroad?” The news article goes on to say, “It is so expensive to give birth and raise a child in Korea […]Babysitters are difficult to find. When fortunate enough to find a Korean Chinese babysitter, her minimum salary is KRW 1.7 million per month, while a Korean babysitter costs KRW 2.5 million at least […] Even Japan has decided to import foreign domestic workers in particular areas, such as Osaka.” The most noticeable point raised in the article is that most Singaporeans and citizens of Hong Kong have been using young foreign domestic workers in their homes costing the equivalent of as little as KRW 500,000 to KRW 800,000 per month for more than 40 years. However, the Korean government has not used this simple and easy way to help couples raising children, but instead has spent KRW 150 trillion over the past 10 years in other efforts to raise the nation’s low birthrate. Despite such efforts, this low birthrate has not risen, but has further decreased instead.
Singapore, Hong Kong, and Taiwan have engaged inexpensive foreign domestic workers to take care of their children, aging parents and housekeeping, which has made it possible to increase women’s participation in employment and resolve their manpower deficits due to low birthrates and aging populations. Recently, public opinion has begun supporting the idea of bringing in foreign domestic workers, and the Ministry of Employment and Labor has recognized the need to do so in a report by an external research consulting firm in 2016. It is therefore expected that sooner or later Korea will make the necessary policy changes to allow foreign domestic workers to be brought into the country.
Herein I will look at domestic legal protections for and international guidelines on domestic workers, the foreign domestic worker (FDW) scheme in Singapore, and considerations when deciding to import foreign domestic workers into Korea.
< Comparison of Status for Domestic Workers, by Country>
Korea Singapore Hong Kong
Total population 50,503,933 5,696,506 7,317,227
Per capita GDP (USD) 27,195 52,755 42,097
participation rate - women 52.1% 60.4% 54.8%
Foreign domestic workers (FDW) 201,973 237,100 340,000
(FDWs as percentage of total population) 0.4% 4.2% 4.7%
Monthly wages for FDWs (KRW) 1.7~3 million 450,000~650,000 From 639,210
* Sources: Government statistics agency for each country, as of 2016
II. Existing Legal Protections for Domestic Workers
1. Global standards
In 2011, the 100th General Assembly of the International Labour Organization (ILO) adopted the Convention Concerning Decent Work for Domestic Workers and a Recommendation. The major content of the Convention includes regulation of domestic workers under national labor law as would be the case for other workers, such as reasonable working hours, 24 consecutive hours off a week, restrictions against payment in kind rather than cash, clear statements of working conditions, and freedom of association. As of May 20, 2014, the Convention has been ratified by 14 ILO member countries, most of whom are supplying domestic workers to other countries. Korea has not yet ratified the Convention, but legal enactment has been proposed by some lawmakers to conform to ILO standards, but no legislative action has been taken.
2. Korean domestic workers and application of labor law
(1) Reasons why domestic workers are excluded from labor laws
Here, ‘domestic worker’ refers to persons employed for the purpose of assisting with housekeeping duties (cooking, cleaning, nursing, childcare, etc.). Since the employer is not the business owner or workplace seeking business, but rather individuals or households, general labor laws do not apply to domestic workers. Article 11 of the Labor Standards Act explicitly excludes domestic workers from application: “This Labor Standards Act shall apply to all businesses or workplaces in which five or more workers are ordinarily employed. This Act, however, shall not apply to any business or workplace which employs only relatives living together, and to workers hired for domestic work.”
Domestic workers are not covered by labor law for primarily two reasons. First, relations between an employer and a domestic worker are considered private relations that do not fall under governmental authority. Caregivers are usually involved in care of a particular person and provide exclusive care, but if they work for a care-providing company and receive a wage in return for providing that care, they are considered someone to whom the labor law applies. Second, a domestic employer is not considered a business or workplace, because he/she does not employ a domestic worker to seek profit or accomplish a business purpose, but simply for convenience.
2) Necessity for protection
Domestic workers, as pointed out in the ILO report, do not receive protection against low salaries, abusively-long working hours, and the loss of rest hours, and sometimes suffer from mental, physical and sexual abuse, and have restrictions on their freedom of movement. Accordingly, considering the length of working hours while exclusively engaged with a particular family, it is necessary to protect their basic rights such as by mandating a minimum salary, maximum working hours, and guaranteed off-days.
III. The Foreign Domestic Workers Scheme in Singapore
In order to assist couples who both work outside the home, the Singaporean government introduced the Foreign Domestic Workers Scheme in 1978. Since Singaporean couples could hire domestic workers from an abundant labor pool in the neighboring countries of the Philippines, Indonesia, Thailand, and Myanmar for much less than hiring locally, the labor force participation rate of married Singaporean women has increased from 14.7 percent in 1970 to 60.4 percent in 2016. There are about 237,000 foreign domestic workers in Singapore, or 4.2 percent out of the total population of 5.61 million, who are employed by the majority of households. The Singaporean government has adopted a very expensive employment levy in order to restrict the overuse of foreign domestic workers. However, families that need domestic workers for one or more of the following reasons receive a significant discount: ① the family has a child or grandchild living with them who is a maximum 16 years of age; ② the family has an elderly family member living with them who is at least 65 years old; ③ the family has a person with disabilities living with them. In particular, in cases where the couple works outside, any collected employment levy will be refunded.
The two key elements for the success of Singapore’s foreign domestic worker scheme are its favorable external environment and thorough internal management. The external environment refers to the sufficient amount of manpower in the neighboring countries, who support their nationals going abroad to make money due to the low salaries and high unemployment rates in their own countries. Internally, the Singaporean government has a strict and thorough management system over foreign domestic workers.
2. Hiring and employment within the foreign domestic worker scheme
There are five stages in the procedures for employment.
(1) Stage 1: Getting ready & selection
① Employer attends orientation program
② Employer looks for a candidate at the licensed civilian employment agency. Employer should come to an agreement with domestic worker on employment terms (e.g. salary, rest days).
(2) Stage 2: Before the foreign domestic worker’s arrival in Singapore
③ Employer shall apply for a Work Permit from MOM (Ministry of Manpower). When applying for a work permit for a foreign domestic worker, the employer shall submit a security bond and evidence of medical insurance and personal accident insurance. These three items can be purchased as one package. If the application is approved, MOM will send employer a preliminary approval letter.
④ Employer shall mail the a preliminary approval letter and an air ticket note to the foreign domestic worker.
(3) Stage 3: Upon the foreign domestic worker’s arrival in Singapore
⑤ Within 3 days of the foreign domestic worker’s arrival, employer shall send her for the 1-day settling-in program (SIP) training course.
⑥ Within 14 days after arrival, employer shall send the foreign domestic worker for a medical examination.
⑦ Employer shall request online for MOM to issue the Work Permit.
(4) Stage 4: Employment relations with the foreign domestic worker
⑧ During the foreign domestic worker’s employment, the employer must send her for a medical screening every six months, and report the result to MOM.
⑨ Within 1 month of the foreign domestic worker’s arrival in Singapore, employer shall make the 1st monthly levy payment, and continue to pay it monthly.
⑩ Employer shall pay the salary within 7 days of the end of the month, and pay it at least once a month. Employer shall transfer the salary directly to the foreign domestic worker’s bank account in Singapore.
5) Stage 5: Termination of employment and repatriation
⑪ The employment contract shall be made for a 2 year period, and renewal is possible only once After a maximum of 4 years, the foreign domestic worker shall leave the country.
⑫The employer shall inform the foreign domestic worker of the expiration of her employment contract 2 weeks in advance, pay all outstanding wages, and cover costs of the flight and all others necessary for repatriation.
IV. Considerations when Deciding to Bring Foreign Domestic Workers into Korea
1. Internal considerations (in the system)
(1) Preparation of relevant laws
The ‘Act on Foreign Workers’ Employment, etc.’ deals with non-professional workers (E-9) and overseas Koreans (H-2) who are fully protected by Korean labor law. Since domestic workers are regarded as a special type of worker excluded from direct application of labor law, it is necessary to prepare special regulations or guidelines when considering the introduction of foreign domestic workers to Korea.
(2) Security bond
In reviewing Singapore’s Foreign Domestic Worker Scheme, the most impressive item to be reflected on is the security bond. In Korea, the employer is not responsible if a foreign worker disappears from the workplace, but in Singapore, the employer’s deposited security bond of SGD 5,000 (KRW 4.1 million) is forfeited in most cases. As this represents a serious financial hit for most household employers, they take extra care to ensure their foreign workers do not disappear.
(3) Protection programs for foreign domestic workers
Even though Korea has not yet ratified the ILO’s Convention Concerning Decent Work for Domestic Workers, we need to thoroughly train and manage persons who will employ foreign domestic workers to ensure compliance with the related suggested measures such as reasonable working hours, provision of a weekly holiday, and written statements of actual working conditions. Just as in Singapore, Korea needs to introduce a systematic management system such as pre-employment and semi-annual medical examinations, secure accommodations, medical insurance, and provision of round-trip air tickets. In particular, it is necessary to create regulations against and procedures for remedy for sexual/physical violence by the employer, long working hours, and violations of other human rights, and otherwise establish a system to protect foreign domestic workers.
2. External considerations (in the market environment)
(1) Balancing the supply of and demand for domestic workers
Singapore has used foreign domestic workers for the past 40 years and has been able to keep costs down as it does not use an Employment Permit system to control employment, but a Work Permit system that allows it to maintain a better balance between supply and demand. In Korea, only a limited number of foreign domestic workers are allowed to be hired and into the country and all must be overseas Koreans (H-2 visa holders) from China. As demand is greater than supply, the cost difference between hiring overseas Koreans and native Korean domestic workers is insignificant. Here, the basic reason to bring domestic workers from more nations into Korea is to lower costs. In light of this, by maintaining a balance between supply and demand, Korea can also take advantage of the resulting cost-effectiveness over a long period of time just as Singapore has done through its Foreign Domestic Worker Scheme.
(2) Language and accommodation issues
In Singapore the official language is English, so there is no great difficulty in communicating with foreign domestic workers in English. Countries that send such workers, like the Philippines, Myanmar, Indonesia, and Sri Lanka can also communicate in English, and many applicants from those countries have college degrees as well. However, in Korea, as English is hardly used in ordinary homes, there will be communication issues due to language. Foreign domestic workers would need to be able to speak some Korean for basic communication. Therefore, significant incentives for those who pass Korean language proficiency tests will be needed to attract those who can speak Korean.
(3) Preparations to prevent illegal stays
The most important point when considering opening Korea to foreign domestic workers is to keep costs down. Prevalence of cases where foreign domestic workers run away from their place of employment and move to better-paying jobs will render any foreign domestic worker scheme ineffective in this regard. Accordingly, before introducing any foreign domestic worker scheme, prior system measures need to be in place to make it difficult for foreign domestic workers to stay illegally. As explained above, one method is to hold the employer responsible through the threat of losing a significant security bond.
In importing and employing foreign workers, it is necessary to keep relations mutually-beneficial by means of supplementing manpower needs and sufficient compensation for the foreign workers. Singapore has managed its foreign domestic worker scheme in a strict manner, and the program has been able to provide benefits to employers and foreign domestic workers alike for a long time. In the interest of addressing the present issues in Korea of a low birthrate and an aging population, Korea needs to introduce and develop an operating system of bringing in foreign domestic workers. Singapore’s foreign domestic worker scheme would be an important program for Korea to benchmark.