Immigration Laws: December, 2000 - Number #18

Korea has few foreign workers. Instead, Korea has mostly foreign trainees who are not entitled to Korea's minimum wage or covered by Korean labor laws requiring, for example, overtime pay. Trainees, whose monthly payment is set at 650,000 won ($576), earn more if they "go illegal" by abandoning the small employer to whom they were assigned.

Thus, many small employers withhold wages and take steps to keep their trainees from running away, leading to reports of human rights abuses. Nonetheless, 85 percent of foreigners who enter Korea as trainees have left the employer to whom they were assigned.

The Korea Federation of Small Business manages the trainee program and does not want major changes. However, the ruling Millennium Democratic Party wants the foreigners to be considered workers, not trainees, and wants the government, not the KFSB, to manage foreign workers. The KFSB and the Justice Ministry oppose the proposed foreign worker plan, but the Labor Minister and an association of foreign workers in Korea are in favor of converting trainees into workers.

Under the proposed foreign worker program, to go into effect in 2002, Korean employers would have to prove to the Ministry of Labor, which plays no role in the current trainee system, that they sought Korean workers before obtaining permission to employ guest workers. The foreign workers and Korean employers would then sign renewable one-year contracts that would allow the workers to remain in Korea for up to three years.

Unemployment is expected to rise to 1.1 million by the end of 2000, but Korean employers complain that Koreans do not apply for "3-D" (dirty, difficult and dangerous) jobs. Experts say that wages are too low-typically 700,000 to 800,000 won ($614 to $704) per month for a six-day workweek and three additional overtime shifts: "The wages are hardly ample compensation for the hard work, a major reason why job seekers tend to avoid 3-D jobs."

There are more than 500,000 foreigners in Korea, and they come from 176 countries. The largest group, 30 percent, are Chinese. The government estimates that there are about 160,000 foreigners illegally in the country. The Seoul Metropolitan Police Agency on October 31 reported that crimes committed by illegal aliens in Korea have more than tripled in the last three years. In 1997, there were 80 cases of crimes committed by illegal aliens and 271 in 1999.

Korea has recovered from the 1997 financial crisis, but the government remains reluctant to allow bankrupt industrial firms that provide jobs to fail. Anbo Iron & Steel Co continues to produce steel despite being bankrupt, and Hyundai Engineering & Construction Co was near bankruptcy in November 2000. There are $100 billion in nonperforming loans to Korean industrial firms; about 25 percent of Korea's industrial firms are believed to be technically bankrupt. One firm, Daewoo Motor Co, was allowed to slip into bankruptcy on November 8, 2000.

"Small companies oppose work permit system for foreigners," Korea Times, November 21, 2000.
"Civic groups form joint panel for foreign laborers' rights," Korea Herald, November 4, 2000.
"Crimes committed by illegal aliens in Korea on the rise," Korea Herald, November 1, 2000.
"Resident foreigners exceed 500,000," Korea Times, October 31, 2000.