Labor ministry tightens reporting for employers leaving joint welfare funds

The revised rules require joint labor welfare funds to notify the labor ministry within three weeks when an employer withdraws.

Previously, there was no procedure to promptly determine whether a departing employer had established an in-house labor welfare fund with distributed assets or whether a withdrawal created a gap in employee welfare programs. The ministry said the measure will strengthen its supervision of departing employers. It also plans to encourage compliance with the law and provide guidance on establishing in-house labor welfare funds.

The partial revision to the Enforcement Decree of the Framework Act on Workers' Welfare was promulgated Aug. 25 as Presidential Decree No. 36621. It took effect upon publication and applies to withdrawals occurring afterward. It excludes cases in which the departure constitutes grounds for dissolving the joint fund. Reports must follow procedures set out in labor ministry regulations, and the decree adds receipt of the reports to the ministry's duties.

Employers leaving a joint fund must use property apportioned to them upon withdrawal to establish an in-house labor welfare fund corporation or contribute it to the resources of an in-house labor welfare fund.