The Ministry of Employment and Labor (Minister Kim Young-hoon) announced on December 16 that it will adjust the employer contribution rate for the Wage Claim Guarantee Fund from the current 0.06% of total remuneration to 0.09%, effective next year.
The employer contribution to the Wage Claim Guarantee Fund has been collected to cover the costs of the wage claim guarantee project, such as advance payments for unpaid workers and loans for wage arrears settlement support. The rate has been flexibly adjusted according to economic conditions. The newly announced employer contribution rate is the first adjustment in 10 years since 2015, and it was finalized at the Contribution Management Deliberation Committee meeting held on December 12, following labor-management agreement at the Wage Claim Guarantee Fund Deliberation Committee meeting on November 12.
According to the Enforcement Decree of the Wage Claim Guarantee Act, the Wage Claim Guarantee Fund is required to accumulate reserve funds equivalent to or greater than the amount of advance payments made in the previous year (7.242 trillion KRW in 2024). However, as of October 31, 2025, the reserve fund stands at 2.381 trillion KRW (0.33 times), falling short of the requirement. This adjustment was made considering the need to secure resources to stably protect unpaid workers, as the contribution rate has been frozen since 2016 despite continuous system improvements, leading to accumulated financial deficits since 2019 due to increased unpaid wages and advance payments.
Choi Kwan-byung, Director of Labor Standards Policy, stated, “It is fortunate that resources to protect unpaid workers can be secured through labor-management agreement,” and added, “The government will actively support the livelihood stability of unpaid workers with these valuable resources and make every effort to eradicate wage arrears.”