Research Report
Data-based Evaluation of Legislation: Legislation for Inclusive Growth(Ⅳ) - ACT ON FOREIGN WORKERS' EMPLOYMENT
Ⅰ. Background and Scope
▶ Background of Legislative Evaluation
○ ‘Act On The Employment, Etc. Of Foreign Workers’(hereinafter ‘Foreign Employment Act’), enacted in 2003, regulates the employment permit which is a state-led foreign worker supply system
- The employment permit system was designed to supply stable labor power to employers by systematically importing and managing foreign workers.
○ To maintain the employment permit system effectively, the ‘Foreign Employment Act’ sets a "restriction on workplace change" rule.
- Article 25 of the ‘Foreign Employment Act’ stipulates that foreign workers who entered the country through the employment permit system should not leave the initial workplaces at the time of employment to change their workplaces.
- However, the workplaces can be exceptionally changed only if the employers are responsible for the reason of change. Even in this case, the total number of times of changing is limited in three times during the three-year employment period.
○ The one position which urges to maintain the restriction on workplace change rule to secure and manage the labor force smoothly, and the other argument that improvements are necessary to guarantee the human rights of foreign workers are at odds.
○ The objective of this study is to suggest reasonable way to amend the workplace change restriction regulation under the Foreign Employment Act by normative evaluation and empirical data analysis.
▶ Scope and Methodology of Legislative Evaluation
○ The scope the study is limited to legislative evaluation of Article 25 of the Foreign Employment Act, and Article 30 of the Enforcement Decree of this Act.
- In order to maximize the efficiency of the evaluation, the scope is limited to the evaluation of the workplace change restriction regulation, one of the core systems of the employment permit system, not the post-evaluation of the Foreign Employment Act as a whole.
- Post-evaluation is performed on if the legislator's legislative purpose was realized through the regulations, and if there is a need for improvement after 17 years since the system has implemented.
Ⅱ. Current status and problems of the employment permit system
▶ Overview of the employment permit system
○ The Foreign Employment Act is based on the employment permit system by which the state thoroughly manages from the introduction of foreign workers to employment activities, and departure after the end of the employment period.
- The employment permit system consists of a general employment permit system corresponding to non-professional employment status (E-9), and a special employment permit system (H-2) that is applied only to overseas Koreans.
○ The main content of the employment permit system is that the state actively manages and intervenes in the labor market in the public domain, behalf of employers.
-The labor permit system provides workers who hold certain qualifications with job opportunities.
- The current employment permit system entails a risk of forced labor depending on the degree of restriction.
- The workplace change restriction system has been criticized and recommended for improvement by the international community.
▶ Workplace Changing Restriction Regulation
○ Foreign workers can change their workplaces only when they are unable to work due to reasons attributable to their employers, and foreign workers cannot change their workplaces by their own will.
- In the event of a reason, the foreign workers must apply for a “workplace changing application”, and if they fail to find a job within three months after then, they must leave the country. If you do not leave the country, they are subject to repartriation.
○ There is controversy over whether the regulation of restriction on workplace change violates the freedom of foreign workers to choose a job.
- The Constitutional Court decided constitutional by 5-4 judges, in the constitutional appeal judgment on Article 25 (4) of the Foreign Employment Act and Article 30 (2) of the Enforcement Decree of this Act in 2011.
- It was judged that the legal provisions did not violate the freedom of occupation for claimants who are foreign workers, and did not judge the claim of forced labor.
Ⅲ. Normative Evaluation
▶ Hierarchical System Legitimacy – Constitutional Basic Rights
○ System Legitimacy is a constitutional principle that binds legislators to maintain a system and balance without contradiction among the structures and contents of norms.
○ It is controversial whether the regulation of restriction on workplace change actually stipulates forced labor of foreign workers by law, then violates the equal rights of foreign workers compared to domestic workers.
○ Freedom of Occupation.
- Given that foreign workers have legally obtained employment permits and have been granted their status as legitimate workers in the country, freedom to choose and make decisions without interference from the state is a constitutional right.
- The restriction regulations on workplace change also infringe on the 'right to work environment' that is closely related to 'freedom of occupation'.
○ Personal liberty – forced labor
- Even if it is allowed to restrict working conditions and changing workplace for foreign workers for the legislative purpose of the Foreign Employment Act, it violates the Constitution to put foreign workers in a de facto forced labor state against the proportional principle.
○ Right to equality
- The regulation restricts changing workplace only for foreign workers, thereby treating them differently compared to domestic workers and foreign compatriots.
- Since a clear sign of anti-discrimination of nationality and employees are confirmed, infringement of equal rights could be recognized if the right to equality is judged by strict criteria.
▶ Horizontal System Legitimacy
○ Relationship with the Labor Standards Act
- The Labor Standards Act is a basic law for guaranteeing workers' constitutional rights, and other laws that stipulate workers' working activities, including working conditions and fair rewards, must comply with the standards set by the Labor Standards Act.
- Nevertheless, the Foreign Employment Act conflicts with the Labor Standards Act as it contains the content of denying the rights of workers guaranteed by the Constitution.
○ Relationship with Immigration Act
- The restriction of changing the workplace of foreign workers (Article 21 (1) of the Act) and the prohibition of employment of (Article 21 (2) of the Act) of the Immigration Act complement and strengthen the restrictions on workplace changes.
- It does not conform to the horizontal system consistency with the Labor Standards Act.
○ Relation with international norms
- Contents related to labor and employment in the "Social Rights Convention" and the prohibition of forced labor in the "Liberty Convention" are international laws that also apply to foreigners.
- Korea ratified and joined most of the conventions of the International Labor Organization(ILO), in particular, the ILO No. 29 Forced Labor Convention was ratified at the plenary session of the National Assembly in 2021. This is an convention that prohibits all forms of forced labor provided involuntarily.
- Since the Constitution does not directly have any regulation that stipulates forced labor, international norms related to the prohibition of forced labor will be specific applicable norms.
- In employment relations, it is included in the scope of forced labor when workers cannot form employment relations according to their free will or cannot quit the relation freely at any time.
▶ Internal System Legitimacy – System and Construction of the Law
○ Article 25 of the Foreign Employment Act is included in Chapter 4, Protection of Foreign Workers.
- In the event of a specific reason, foreign workers are allowed to change their workplaces in accordance with laws and regulations, which apparently protects them and guarantees freedom of occupation, but in reality it cannot be regarded as guaranteeing the freedom of occupation for foreign workers.
- It is systematically consistence that the restriction on workplace change to be placed in Chapter 3, Employment Management of Foreign Workers, not Chapter 4.
▶ Comparative Law Analysis
○ U.S.
- As an immigrnat country, the United States has been resolved the labor shortage in the development process through active immigration policies and temporary employment visas. The US foreign recruitment system is better developed and more complex than any other country.
- Within the Department of Homeland Security (DHS), three departments, including the office of the Citizenship and Immigration Services (CIS), the Customs Border Protection (CBP), and the Immigration Customs Enforcement (ICE), share tasks related to immigration and stay.
- Bureau of Consular Affairs in U.S. Department of State is in charge of nonimmigrant visa application, while Labor Department is responsible for labour of immigrants permission.
- The US foreign workforce policy is not particularly limited to professionals or non-professionals, but is widely open to all areas required by the labor market. However, the basic principle allows workers who are beneficial to the national interest without adversely influencing the working conditions or wages of domestic workers.
- The US actively procures insufficient labor from abroad, but flexibly applying measures to protect the domestic labor market. The Immigration Nationality Act limits the number of immigrants or short-term employment who can enter a year for each visa type by their own standard.
○ Germany.
- Germany lowers the barrier for skilled technical personnel from third countries to help them access easily to the labor market, while maintaining a high barrier for simple labor personnel.
- It is possible for unskilled workers from third countries other than members of the European Union to enter Germany with the qualification to stay for employment purposes, when they fall under certain occupational groups under employment regulations or inter-country agreements. However, a quite large number of unskilled workers flows into the country by other forms such as family reunion or humanitarian reasons.
- Germany's current labor permit system allows foreigners to access the labor market without any restrictions during their stay if they are granted a work permit along with their status of stay.
- The "guest worker" system, which was introduced from the late 1950s and to 1970s, is similar to Korea’s current employment permit system in that it tried to manage foreign labor by government recruiting, and granting residence and labor permits under limited conditions. Thus, this study focused on that system.
- The "guest worker" system is characterized by the fact that the state recruits foreign workers based on priority employment for domestic workers, agreed wages, circular principles, and permanent migration management principles.
- The government were able to determine the length of stay and employment range of foreign workers as needed. Until 1964, a work permit was issued in connection with a residence permit on the condition that foreign workers can be employed only in a specific workplace for up to one year.
- Since it is inefficient to send back existing skilled foreign workers, and receive new workers to train again, employers wanted to extend existing foreign workers' labor permits, and the government allowed it.
- The principle of circulation gradually eased, as the expansion of opportunities for foreign workers to sign indefinite contracts and the abolition of restrictions on jobs to choose.
- The initial work permit period has been extended from one year up to two years, and it is possible to extend the work permit or issue a work permit without restrictions. This makes it possible for guest workers to change jobs and improve wage levels and working conditions.
○ Japan
- Japan's foreign workforce market has a higher proportion of short-term stay, such as non-qualification activities and technical tranee, than for long-term employment.
-The Japanese government is implementing a policy to expand employment for foreigners as the shortage of labor force in the country due to the low birth rate and aging population has emerged as a social problem in Japan.
- In order to cope with the shortage of labor power, Immigration Control and Refugee Recognition Act was revised in 2019, and a new stay qualification called Specified Skill 1 and Specified Skill 2 was newly introduced. The revised law officially allows foreign workers even in the simple labor field that has not been allowed so far.
- Specified Skill No. 1 is a residence qualification issued to foreign workers engaged in work that requires a considerable amount of knowledge or experience, and can stay in Japan for up to five years in total.
- Specified Skill 2 is a residence qualification issued to foreign workers engaged in tasks that require skilled skills without no restriction on the length of stay. In principle, if the workers of a specific skill 1 passes the examination, it becomes possible to acquire qualifications for a specified skill 2.
- When a foreigner applies for permission to change his/her status to stay in a specific skill or to change his/her period of stay, he/she may grant permission at his/her discretion in consideration of various requirements.
Ⅳ. Empirical Data Analysis
▶ Suvey on employers of immigrant workers
○ To collect opinions from employers on the restriction of workplace changing for foreign workers, a survey was conducted on 155 companies employing foreign workers.
- The average number of employees of the companies was 57.6, of which the average number of Korean workers was 50.1, and that of foreign workers was 7.5 (about 13%).
○ 62.6% of employers want "workers with low wages."
- Only 16.8% of employers want "workers with a lot of work experience" even if wages are somewhat high, and 20.6% want "workers with high technology" even if wages are somewhat high.
- This presents the employer's point of view on foreign workers as providing cheap labor and replaceable at any time.
○ Wages account for 41.6% of the relative importance of factors for hiring foreign workers. 21.6% of the respondents said their Korean proficiency and 16.1% of their expertise in the field are importance for hiring.
○ A mean score of 2.1 points (5-point scale) was answered as to how difficult the process of hiring foreign workers is. The most difficult thing in hiring foreign workers is to hire when necessary. 16.7% answered that they do not know about foreign workers when hiring.
○ A mean score of 2.71 (5-point scale) responded to difficulties in maintaining employment for foreign workers.
○ As for whether foreign workers have ever requested a change in their workplaces, 59.4% answered to have been asked to change their workplaces.
- 56.5% of respondents said they agreed without objection. 37% said they did not agree at first, but later agreed to change.
- 17.4% of respondents said that foreign workers have left their workplaces.
○ As for the current restriction system on the change of workplace for foreign workers, 55.5% of the respondents generally agreed, 37.4% of the respondents netural, and 7.1% opposed.
- 52.9% of the respondents said that if the workplace can be changed freely, hiring foreign workers will be more difficult than now, 29.7% said it will not be much different from now, and 17.4% said it will be easier.
- As for the problems that will occur when allowing changes, frequent turnover was 50.3%, and weakening control over foreign workers was 20%.
- As for the positive impact of allowing changes, 33.5% of the respondents said they could easily hire necessary foreigners in a timely manner, and 20.6% said that the rights of foreign workers could be guaranteed. 30.3% of the respondents said there would be no positive impact.
- As for the extent to which foreign workers should be restricted or allowed to change their workplaces, 65.8% said it should be allowed if there is a problem with the workplaces as it is now, and 15.1% said that dismissal and change workplaces should be free after a certain period of time.
▶ Interview on immigrant workers supporting organization
○ As the contract period extended to three years due to the revision of related laws in 2010, the dependence of foreign workers increased.
- Even if a foreign worker suffers from unfair labor practices, it is difficult for a foreign worker to prove it.
- Even if a foreign worker applies for a change in his/her workplace through the Internet due to reasons prescribed by law, administrative procedures will not proceed unless his/her workplace register the change.
○ The restriction system for change of workplace for foreign workers is used as a means of forced labor, and maintaining poor working conditions.
- In order to re-enter the country, the consent of the current business owner must be obtained, so there are many cases where the workplace cannot be changed to obtain consent.
- When change of workplace is requested, the foreign workers are subject to disadvantages such as work exclusion, arrears of wages, etc., or are asked for financial consideration.
- It is also a problem to instill the idea that foreign workers belong to the employer in the workplace change restriction system.
○ By improving the restriction of workplace change regulation, it is expected to improving working condition, and giving foreigners the right to change workplaces.
- As long as the employment quota of foreign workers is controlled, there is no shortage of foreign workers.
- Partial improvement that enables workplace change within the existing E-9 visa or within the scope of the workplaces that want to hire foreign worker can be an option. An alternative may be to allow free changes after a one-year mandatory period.
Ⅴ. Conclusion
▶ Legislative evaluation results and alternatives: improvement measures
○ Allowing change of workplaces only due to reasons attributable to employers as in the present violates the principle of freedom of contract, freedom of occupation, right of equality, and freedom of body.
○ Foreign workers' right to move to work must be guaranteed in compliance with the Constitution (principles) and international norms.
○ It is necessary to improve the system to set a mandatory employment period and allowing them to move their workplaces according to their own will, to recognize the right of change of workplace.
- It is possible to reasonably set the mandatory employment period, the area where employment is possible, and the number of workplace changes.