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Subject   September 2018 - The System for Employing Foreign Workers
The System for Employing Foreign Workers

I. Introduction
Foreign workers are classified according to visa status: (i) non-professional foreign workers, (ii) overseas Korean workers (working-visit workers and overseas Koreans), and (iii) professional foreign workers. Only foreign workers with non-professional and working-visit status are subject to the Act on Employment Etc. of Foreign Workers (hereinafter “Foreign Employment Act”), while overseas Koreans and professional foreign workers are subject to the Immigration Control Act and general labor laws.
Non-professional foreign workers are employed as short-term circulating workers that stay for a certain period based on the Foreign Employment Act to supplement the workforce in Korea. However, overseas Korean workers voluntarily enter the country for economic reasons and are able to stay for a longer time. Companies invite professional foreign workers to work here to harness their professional knowledge, and so employment procedures are complicated but staying long-term is possible. Since foreign workers are introduced to address Korea’s needs, it is desirable that they be introduced in a way that maximizes Korea’s own interests. Recently, the proliferation of illegal immigrants has raised awareness of the need for more careful management of the foreign employment system. For this reason, I would like to examine specifically the system for employing foreign workers in Korea.

Status of Foreign Employment in Korea
        Total Persons/Percent        (i) Non-professional Workers        (ii) Overseas Koreans        (iii) Professional        (iv)
Illegal Workers
Visa Type                E-9 Non-professional        E-10
(Ship crewmen)        H-2 (Working visit)        F-4 (Overseas Korean        F-5 (Permanent resident)        (Visit/ residence (F-1, etc.)        Professor etc.
(E-1/ E-7)        -
Persons                276,811        16,010        243,339        432,485        90,214        93,571                
Total Persons        1,523,153        292,821        859,609        47,156        323,267
% of all Foreign Workers        100        19.2        56.4        3.1        21.2
Source: Ministry of Justice, “Monthly Immigration Statistics”, June 2018.

II. Non-professional Workers
1. Eligible Workers & Jobs
Non-professional foreign workers (E-9) are invited from 16 countries such as China, countries from the former Soviet Union, and Southeast Asian countries to supplement SME workforces in Korea’s “3D” jobs (dirty, dangerous, difficult). To be eligible for employment, such workers must pass strict selection procedures such as a Korean Proficiency Test, a technical test, and a physical examination to facilitate their adaptation to a Korean workplace.
Non-professional foreign workers were introduced through the General Employment Permit System in 2004, starting in manufacturing, construction and agriculture and expanding to fisheries in 2016.
Manufacturing companies must have fewer than 300 regular workers or less than KRW 8 billion in capital as a prerequisite to employing foreign workers. The allowable number of foreign employees varies by the size of the company, but is usually about 10-20% of the total workforce. The allowable number of employees in a construction company is 5 persons if the average annual construction revenue is less than KRW 1.5 billion, and 0.4 per KRW 100 million over 1.5 KRW billion. An agricultural company with 10 or fewer employees can employ up to 5 people regardless of no Korean worker employed, up to 20% of the total workforce. In the fishery industry, foreign employees can be used only on fishing vessels of less than 20 tons, which are not subject to the Seamen’ Act, and can make up to 40% of the total fishing workers per ship.

2. Employment Procedures
The detailed procedures for employment within the Employment Permit System is as follows.
(1) Efforts to hire Korean workers: Employers seeking to hire foreign workers first apply at the local employment center. In an effort to ensure Korean workers have enough jobs, employers seeking to hire foreign workers are obliged to seek Korean workers first: 14 days through the employment center, and 7 days through newspapers, broadcasts, daily information magazines, and other media.
(2) Application of employment permit for foreigners: If an employer is unable to hire suitable Korean workers despite his efforts to do so, the employer may apply for a foreign employment permit at the employment center, within 3 months after completion of the local employment effort.
(3) Issuance of employment permits: When an employer asks the employment center to issue a work permit, the center will introduce some foreign workers (three times the number requested), from whom the employer will select those most eligible for the employment. Employment permits are then issued.
(4) Making an employment contract: Upon issuance of an employment permit, the employer shall send a standard employment contract to the KHR(Korea Human Resources) Corporation, who shall then send it to the dispatching agency of the sending country. When the sending agency of the sending country contacts the foreign workers selected by the employer and confirms their intention to enter into an employment contract, the standard employment contract sent by the employer is finalized and sent back to KHR, after which the employment contract is concluded.
(5) Application and issuance of visa issuance certificate: When an employment contract is concluded, the employer can obtain a certificate of visa issuance from the immigration office. Once a certificate of visa issuance is issued, the employer sends its certificate of a temporary visa to the relevant workers by means of the sending agency of the sending country.
(6) Orientation training for foreign workers: When foreign workers enter Korea with a non-professional employment visa (E-9), escorted by the sending agency, they are taken to the KHR Corporation representative at Incheon International Airport. They are then taken to the employment institutions allocated for training of persons from each country and industry, and will receive job orientation for 2-3 days (16 hours). If health checkups reveal no interfering health concerns and the foreign workers are able to complete their orientation, the corresponding employers will pick up the ones assigned to them in their notification from the employment training institution.
(7) Reporting any changes to employment of foreign workers: If a foreign worker is no longer employed, has been injured, has died, or has had the employment contract renewed, the employer should report such changes to the employment center.
(8) Change of workplace for a foreign worker: In principle, foreign workers should continue to work for three years at the workplace through which they first gained their employment visa. However, where it is recognized normal working relations are unreasonably difficult to maintain due to a temporary suspension or shutdown of the workplace, unlawful delay in payment of wages etc., foreign workers are allowed to change jobs a maximum of 3 times in such cases as a way to better protect their basic human rights. Employment contracts are allowed to be extended twice, for a total of two years with each extension.
(9) Cancellation of the employment permit and suspension of access: The employment permit will be canceled if the employer breaches the wage obligations or other employment conditions contracted with the employee before the employee entered the country. In addition, any company that employs foreign workers without obtaining an employment permit shall have their access to foreign workers suspended for three years.
(10) Korea’s four social insurances and specific insurances for foreign workers:
① Four social insurances: Of the four major insurances for non-professional foreign workers, registration for the national pension, national health insurance, and industrial accident insurance are mandatory. Unemployment insurance is optional, and only those who subscribe are eligible for unemployment benefits and a variety of employment insurance subsidies.
② Specific insurances: The employer shall subscribe to departure-guarantee insurance and insurance to guarantee on-time payment of wages within 15 days after hiring the foreign worker. Foreign workers are required to have insurance covering their return expenses within 80 days of becoming employed and have their own injury insurance within 15 days.

III. Overseas Korean Workers
1. Eligible Workers & Jobs
Overseas Korean workers are divided into working-visit workers (H-2) that perform non-professional functions and resident workers (F-4) that provide professional services. All overseas Korean workers can work freely inside Korea, but those in the non-professional working-visit category are limited to a maximum of five years and are subject to restrictions under the Foreign Employment Act.
The number of industries allowed to hire workers in the H-2 group has increased from construction and some service industries (6 services) in 2004, to manufacturing, agriculture, fisheries and 29 services (food, housekeeping etc.). As of 2016, the scope has expanded to 41 manufacturing, construction and service industries.
The Foreign Workforce Policy Committee has set and managed the total number of working-visit overseas Korean workers every year because of the potential for conflict with domestic workers, such as those in construction and food and lodging, and determined the total number of people, 300,000, allowed to be in Korea at any given time. F-4 visas are issued to overseas Korean workers who have graduated from university or a higher education institution and are less likely to engage in simple and manual work, and those who are 60 years of age or older. The Ministry of Justice did not issue F-4 visas to overseas Koreans from China and the nations making up the former Soviet Union until 2010, but has gradually been extending such issuance to those meeting certain conditions since then. These F-4 holders are required to renew their visas every three years if they wish to stay longer.

2. Employment Procedures
Working-visit overseas Korean workers with H-2 visas are: ① foreign nationals aged 25 or older, or their descendants, living in China and the former Soviet Union and who were Korean nationals at the time of birth, who are Korean citizens with an address in Korea, or who have been invited by blood relatives within 8 degrees of kinship or by relatives through marriage within 4 degrees of kinship; or ② those who have no domestic relatives or domestic family members but are selected by a certain procedure such as a Korean language test or a random lottery, etc.
Foreign nationals are issued an H-2 working-visit visa from a diplomatic mission abroad, complete their orientation training by the KHR Corporation after entering Korea, and register themselves with the Korean government through the KHR Corporation or an employment center. Employment is then possible through introduction to an available job registered with the employment center or independent job search activities.
An employer who wishes to hire a working-visit overseas Korean has to follow a certain procedure. This includes (1) making efforts to hire a Korean national first. However, the employer can hire a working-visit overseas Korean at his or her discretion. (2) The employer can also receive from the employment center three times as many job seekers as needed, and makes a standard employment contract after selecting the personnel desired. The employer shall then report such employment to the employment center nearest the location of the workplace within 10 days from the date of employment of the overseas Korean. (3) The term of the employment contract shall be determined by agreement between the parties but shall not exceed three years of employment. It can be extended for one year and ten months after the first three years’ stay. Overseas Korean workers on visiting-work visas are allowed to change jobs freely, unlike other foreign workers.

IV. Overseas Professionals
1. Eligible Workers & Jobs
To achieve global competitiveness, companies must provide world-class, high-tech products or services of the highest quality and at competitive prices. Most of Korea’s top domestic talent has been directed at achieving these goals so far, but with the world being integrated into one huge market, domestic talent alone cannot maintain national competitiveness anymore. There is an increasing need to hire excellent personnel that cannot be found locally.
Eligibility of professional foreign workers is determined by the qualifications for certain status of residence: academic background, experience, qualified certificates and expected wage level. There are seven visa types: E-1 for professors, E-2 for native language teachers, E-3 for R&D researchers, E-4 for technicians involved in technical transfers, E-5 for persons professionally qualified, E-6 for entertainers and E-7 for professional workers. Korea has also introduced various systems to support employment of foreign experts: 1) the IT Card visa system for the Ministry of Information and Communication; 2) the Gold Card visa system for the Ministry of Industry and Commerce; 3) the Science Card visa system for the Ministry of Science; and 4) the visa system to support the introduction of foreign professionals for SMEs.

2. Employment Procedures
Companies hiring professional foreign workers are exempt from the normal requirement to hire Korean workers first, and various regulations such as labor market tests do not apply. However, in the interest of promoting the employment of Korean workers, opinion letters of relevant government ministries are inquired to submit to the immigration office in the course of obtaining the related visa. In general, the procedures for recruiting professional foreign personnel are as follows: ① Once the employer has found the necessary personnel and created an employment contract, ② the employer obtains a visa issuance recommendation from the related government ministries. ③ The employer sends the visa issuance confirmation to the Ministry of Justice. ④ If a visa issuance certificate is sent for the relevant worker, the foreign worker is issued a visa at a Korean embassy or foreign mission, and ⑤ the employee is allowed to enter Korea to work.

V. Conclusion
Non-professional foreign workers face a variety of potential human rights violations because they are managed under employer-friendly policies. It is difficult for such personnel to change jobs, and may do so only if the reason for the change can reasonably be attributed to their employer. They can stay for three to ten years, but cannot invite their family members or live together with them. There are limitations to their protection under labor law because they are forcibly sent to their home countries when the employment is terminated.
For overseas Korean workers, there is a lack of systematic education on social integration. The exclusive focus on employment results in a lack of support for their own development. Compared to working conditions for overseas Korean workers from developed countries, those from China and the former Soviet Union are being discriminated against. Workers from advanced countries are allowed to enter and exit freely with the F-4 visa they receive upon entering Korea. On the other hand, overseas Korean workers from China and the former Soviet Union who do not have relatives in Korea must go through H-2 visa issuing procedures, which involves a selection process requiring an official Korean test or a lottery.
Hiring overseas professional personnel is not a simple process due to the vague classification of foreign professionals and rigorous employment procedures. Towards more systematic management of the introduction of a specialized foreign workforce, a dedicated government department is needed that consolidates the existing responsibilities presently spread among a variety of government departments into one, along with a more organized system of qualification standards.


163 (1/9)
No Subject
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