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KLI Employment & Labor Brief No. 102 (2020-09): Dependent Self-Employed Contractors: Evaluating Working Conditions and Employment Insurance Coverage Based on Workers’ Compensation Insurance Data
KLI Employment & Labor Brief No. 102 (2020-09): Dependent Self-Employed Contractors: Evaluating Working Conditions and Employment Insurance Coverage Based on Workers’ Compensation Insurance Data
  • Table of Contents

    Table of Contents

     

    I. Analyzing the Current Status of Dependent Self-Employed Contractors Based on Workers’ Compensation Insurance DB 

    II. Dependent Self-Employed Contractor: Hires, Separations and Seniority

    III. Expanding Coverage of Employment Insurance

    IV. Implications



    Summary

     

    With the advent of the 4th Industrial Revolution, diversification of employment types has been taking place rapidly, evidenced by those in special types of employment (hereinafter referred to as “dependent self-employed contractors”) and platform workers. Dependent self-employed contractors, similar to wage workers, receive earnings by providing labor services to businesses in order to sustain a living on wages, but are excluded from receiving employment insurance because they are not considered as wage workers.

     

    The need to expand employment insurance coverage to dependent self-employed contractors to ensure stable livelihoods and smooth reemployment had been discussed as a major social agenda from the mid-2000s but had not achieved any legislative success. The Moon Jae-in administration presented extending the national employment insurance program to dependent self-employed contractors and artists as a major task, and has been preparing for its implementation through setting up “The Task Force for Employment Insurance System Improvement” and “The Employment Insurance Committee.” In addition, as the recent COVID-19 pandemic has further increased social consensus about the need to address the difficulties of vulnerable groups such as dependent self-employed contractors and to eliminate employment insurance blind spots, there are growing calls for providing employment insurance coverage for dependent self-employed contractors through the revision of the Employment Insurance Act. In May 2020, an amendment to the law for putting artists under employment insurance coverage passed the National Assembly (Promulgated on June 9, Scheduled to take effect on Dec 10), and in September 2020, partial amendments to the Employment Insurance Act (Bill No. 3779) and the Act on the Collection of Insurance Premiums, etc. for Employment Insurance and Workers’ Compensation Insurance (Bill No. 3803) were submitted to the National Assembly as government legislation.

     

    This paper will discuss the main characteristics of dependent self-employed contractors by analyzing the workers’ compensation insurance DB, which is the only data source containing information about the working conditions of dependent self-employed contractors. Also, by examining the survey results on dependent self-employed contractors, this paper will also analyze several additional characteristics related to the eligibility criteria for employment insurance in case it is expanded to include dependent self-employed contractors.