South Korea’s government announced plans to intensify legal actions and asset investigations targeting employers who fail to pay employees. (Image courtesy of Yonhap)
SEOUL, Apr. 22 (Korea Bizwire) – South Korea’s government announced plans to intensify legal actions and asset investigations targeting employers who fail to pay employees, as wage arrears continued rising this year after hitting record highs in 2023.
The Ministry of Employment and Labor said that it has prepared new guidelines to strengthen the handling of reported cases of unpaid wages, effective starting April 22.
Under the revised procedures, labor inspectors must issue corrective orders whenever wage violations are confirmed, immediately initiating legal proceedings if employers fail to comply.
The guidelines call for heightened scrutiny of delinquent employers’ assets like real estate, movable property and bank deposits.
Arrest warrants will be more readily sought against employers who refuse to cooperate, while intentional and habitual offenders face a greater risk of detention during investigations.
To curb employers exploiting wage substitute payment systems to evade responsibility, the ministry will now issue certificates confirming unpaid wages and employer identities based on objective public data sources like social insurance and tax filings.
These certificates can then serve as grounds for advancing preliminary wage payments to workers, replacing previous reliance on court verdicts.
When 10 or more workers apply for substitute payments, employers will be compelled to submit asset listings. The ministry is also expanding oversight of suspected fraudulent claims for substitute wages.
A nationwide special labor inspection targeting companies with egregious, repeated wage violations is forthcoming as well.
Official data shows wage arrears soared to an all-time high of 1.78 trillion won in 2023, followed by 571.8 billion won in the first quarter of 2024 – a 40% spike from the same period last year.
“To improve employers’ awareness about wage obligations, labor inspectors must conduct thorough investigations and strengthen penalties against violators,” said Employment Minister Lee Jung-sik. He pledged the ministry’s full support in parliamentary deliberations to pass revisions to labor laws that would introduce harsher economic sanctions on delinquent employers regarding unpaid wages.
M. H. Lee (mhlee@koreabizwire.com)
