Securing Equal Work Opportunities: Korea’s Mandatory Quota Policy and Training to Promote Employment of People with Disabilities

Context

During Korea’s rapid growth, national policy emphasized other arenas of economic development and reconstruction from the Korean War the in early 1950’s and focused less on the welfare and employment of people with disabilities. However, awareness of the rights of people with disabilities increased throughout the 1980s, and especially with the international spotlight brought by the 1988 Seoul Olympics and Paralympics, public interest turned more to this issue.

Development Challenge

The awareness of the rights of people with disabilities increased throughout the 1980s, and especially with the international spotlight brought by the 1988 Seoul Olympics and Paralympics, public interest turned more to this issue. While the labor force participation rate and the Employment to population ratio 3 of Korea were 61.9 percent and 52.8 percent respectively, those rates were much lower among the persons with disabilities – with a 43.9 percentage of labor force participation rate and 31.9 percentage of employment to population ratio. Also, despite the mandatory quota system introduced in 1990, the unemployment rate of the people with disabilities did not remarkably improve. It was clear that to fully achieve its intended policies, the Korean government would need to adjust its approaches.

Intervention

Policymakers responded to growing public calls for greater opportunities for the disabled by passing the ‘Promotion, etc. of Employment of Disabled Persons Act’ to increase work opportunities for people with disabilities. The Act created a mandatory employment system that obligated national and local governments, public organizations, and private enterprises of a certain size to hire people with disabilities for a certain proportion of positions (See Table 1). To enforce implementation, the Act imposed levies on employers who did not meet the proportion of employees with disabilities. Also, the government established the KEAD in September of 1990 with the mandate to implement the quota system. The implementation of the mandatory employment quota system led to additional job creation of 197,000 jobs in the competitive labor markets. Additionally, 164,000 individuals with disabilities are employed in private companies and central and local governments reaching an actual employment rate 2.14 percentage in 2015.

Delivery Challenges

Implementation of promoting employment with disabilities also faced difficulties in execution due to lack of systems and resources. However, specific law enforcement and support system for implementation of the system, and human resources and infrastructure were both insufficient and not ready. One challenge for the government was that private companies had an antipathy to the new obligation of employing people with disabilities. Specifically, per the Disability Employment Survey, 41.1 percent of employers reported that attitude changes regarding employees with disabilities would be needed . Also, employers highlighted the importance of job training for people with disabilities. In addition to the business owners’ negative attitude toward the new system, many people with disabilities lacked the marketable skills needed for them to be hired. These were definite constraints to reaching the mandatory employment quota set by the government. The government also faced financial challenges in supporting employment of people with disabilities. It implemented the mandatory employment system by imposing a levy on the companies that did not meet the requirements. Despite collecting the levy, the Employment Promotion Fund for the Disabled was depleted in the early 2000’s, and it caused difficulties in supporting the employment of individuals with disabilities.

Lesson Learned

The Continuous Effort of the Mandatory Hiring Quota System

The sharp rise in the employment rate of individuals with disabilities is clearly the outcome of continuous efforts of the government. In addition, the professional role of the KEAD has supported the details of the policies and implementation of projects. The Korean government established the First Five-Year Plan in 1998. The five-year plan aims to set the employment policy with agreement from relevant ministries and to implement the policy. The Fourth Five-Year Plan is now in progress, and sub-sequent plans will be continuously devised. This shows the importance of adaptive implementation of systematic planning that focuses on the mid to long term for policies that deal with shifts in social norms.

Ensuring a Stable Flow of Funds through Levies on Non-Compliant Business

The government tried to diversify fund sources by expanding contributions from the general account; however, it was not enough. To this, amount of subsidy for business owners who exceeds the set employment rate was adjusted, and differential rates of levies depending on employment rate were imposed. As a result, the fund is now financed in a stable manner, and employment policy for people with disabilities can be smoothly implemented. Strengthening Employment Measures for Persons with Severe Disabilities. 

Expanding Awareness Improvement Education on People with Disabilities

In late 2000’s, Korea adopted the system for prohibition of the discrimination toward people with disabilities in recruitment, as an additional incentive, with the mandatory employment quota system, for increasing employment of people with disabilities. Regarding people with mild disabilities the government strengthened the anti-discriminatory policy, and, through the mandatory employment quota system, actively intervenes in the employment market for those with severe disabilities. Since 2010, the Korean government also obligated business owners to conduct education to improve perceptions of disabilities. The law has increased the number of educational sessions conducted every year. The policy for improving perception of disability needs to be expanded with an enhanced connection with education policy.