ENFORCEMENT DECREE OF THE ACT ON THE GUARANTEE OF EMPLOYEES' RETIREMENT BENEFITS

Article 1(Purpose) #

The purpose of this Decree is to prescribe matters mandated by the Act on the Guarantee of Employees' Retirement Benefits and matters necessary for the enforcement thereof.

Article 2(Grounds for Providing Entitlement to Benefits under Retirement Pension Plans as Collateral) #

(1) "Where the grounds and conditions prescribed by Presidential Decree, such as housing purchases, are fulfilled" in the former part of Article 7 (2) of the Act on the Guarantee of Employees' Retirement Benefits (hereinafter referred to as the "Act") means any of the following: <Amended on Dec. 15, 2015; Jul. 2, 2019; Oct. 29, 2019; Nov. 3, 2020>

1. Where a participant who is a non-homeowner intends to purchase a house in his or her own name;

1-2. Where a participant who is a non-homeowner takes a responsibility for the tenancy deposit under Article 303 of the Civil Act or a security deposit under Article 3-2 of the Housing Lease Protection Act for residential purposes. In such cases, the number of such occurrences shall be limited to one time while the employee works in the same business or workplace (hereinafter referred to as "business");

2. Where a participant pays the medical expenses (referring to medical expenses provided in Article 118-5 (1) and (2) of the Enforcement Decree of the Income Tax Act; hereinafter the same shall apply) for an illness or injury of any of the following persons, which requires at least six months of convalescence:

(a) The participant himself or herself;

(b) The spouse of the participant;

(c) Family members dependent on the participant or on the spouse of the participant (referring to the dependent family members under Article 50 (1) 3 of the Income Tax Act; hereinafter the same shall apply);

3. Where a participant is declared bankrupt pursuant to the Debtor Rehabilitation and Bankruptcy Act within five years counted retroactively from the date of offering collateral;

4. Where a participant receives a decision to commence individual rehabilitation procedures pursuant to the Debtor Rehabilitation and Bankruptcy Act within five years counted retroactively from the date of offering collateral;

4-2. Where a participant pays the college tuitions, wedding expenses, or funeral expenses of any of the following persons:

(a) The participant himself or herself;

(b) The spouse of the participant;

(c) The family members dependent on the participant or the spouse of the participant;

5. Cases falling under the grounds and requirements determined and publicly notified by the Minister of Employment and Labor, where an employee's wages decrease since the business owner suspends business operations or where damage is caused by a disaster (referring to a disaster defined in subparagraph 1 of Article 3 of the Framework Act on the Management of Disasters and Safety; hereinafter the same shall apply).

(2) "Extent prescribed by Presidential Decree" in the former part of Article 7 (2) of the Act means the following: <Amended on Dec. 15, 2015; Nov. 3, 2020>

1. In the cases of subparagraphs 1, 1-2, 2 through 4, and 4-2 of paragraph (1): 50/100 of each participant’s reserve;

2. In the case of paragraph (1) 5: The extent determined and publicly notified by the Minister of Employment and Labor in consideration of the severity of damage, etc. suffered by a participant from a decrease in wages or a disaster, etc.

Article 3(Grounds for Interim Settlement of Retirement Allowances) #

(1) "Grounds prescribed by Presidential Decree, such as housing purchase" in the former part of Article 8 (2) of the Act means the following cases: <Amended on Dec. 24, 2013; Dec. 15, 2015; Jun. 19, 2018; Jul. 2, 2019; Oct. 29, 2019; Nov. 3, 2020; Apr. 13, 2022>

1. Where an employee who is a non-homeowner purchases a house in his or her own name;

2. Where an employee who is a non-homeowner pays a tenancy deposit under Article 303 of the Civil Act or a security deposit under Article 3-2 of the Housing Lease Protection Act for residential purposes. In such cases, the number of such occurrences shall be limited to one time while the employee works in the same business;

3. Where an employee pays the medical expenses for an illness or injury of any of the following persons, which requires at least six months of convalescence, in excess of 125/1,000 of his or her total annual wages:

(a) The employee himself or herself;

(b) The spouse of the employee;

(c) The family members dependent on the employee or on the spouse of the employee;

4. Where an employee is declared bankrupt pursuant to the Debtor Rehabilitation and Bankruptcy Act within five years counted retroactively from the date he or she applies for interim settlement of a retirement allowance;

5. Where an employee receives a decision to commence individual rehabilitation procedures pursuant to the Debtor Rehabilitation and Bankruptcy Act within five years counted retroactively from the date he or she applies for interim settlement of a retirement allowance;

6. Where an employer implements a system of reducing wages based on a particular age, length of consecutive service, or amount of wage through a collective agreement, employment rules, etc. on the condition of extending or guaranteeing the current full retirement age;

6-2. Where an employer has reduced an employee’s contractual working hours by at least one hour a day or five hours a week under agreement with the employee, and the employee has agreed to continue to work for at least three months based on the reduced contractual working hours;

6-3. Where an employee receives a reduced retirement allowance due to shortened working hours as the Labor Standards Act (Act No. 15513) enters into force;

7. Cases falling under the grounds determined and publicly notified by the Minister of Employment and Labor, where damage is caused by a disaster, etc.

Article 3-2(Grounds for Exceptions to Transferring Retirement Allowances to Accounts of Individual Retirement Pension Plans) #

(1) "Grounds prescribed by Presidential Decree exist, such as where an employee receives benefits upon retiring at the age of 55 or older" in the proviso of Article 9 (2) of the Act means the following cases:

1. Where an employee receives benefits upon retiring at the age of 55 or older;

2. Where the amount of benefits does not exceed the amount determined and publicly notified by the Minister of Employment and Labor;

3. Where an employee dies;

4. Where an employee who retired after providing labor in Korea under the status of stay eligible to engage in job-seeking activities under Article 23 (1) of the Enforcement Decree of the Immigration Act leaves Korea after retirement;

5. Where other statutes or regulations require a deduction of all or some of benefits.

(2) The balance after deducting some of benefits due to grounds provided in paragraph (1) 5 shall be transferred to the account of the individual retirement pension plan designated by the relevant employee or an account provided in Article 23-8 of the Act (hereinafter referred to as "individual retirement pension account, etc.").

[This Article Newly Inserted on Apr. 13, 2022]

Article 4(Matters to Be Stipulated in Defined Benefit Retirement Pension Rules) #

(1) "Matters prescribed by Presidential Decree" in subparagraph 11 of Article 13 of the Act means the following: <Amended on Apr. 13, 2022>

1. Deleted; <Apr. 13, 2022>

2. Matters concerning payment of fees for implementing operational management services under Article 28 of the Act (hereinafter referred to as "operational management services") and asset management services under Article 29 of the Act (hereinafter referred to as "asset management services");

3. Matters concerning the methods, procedures, etc. for training participants;

4. Matters concerning measures to handle affairs where contracts for the operational management services are concluded with multiple retirement pension trustees; in such cases, where a participant fails to designate an individual retirement pension plan account, etc. pursuant to Article 17 (5) of the Act, matters concerning designation of a retirement pension trustee to whom benefits are to be transferred shall be included therein.

(2) A retirement pension trustee who calculates contributions under subparagraph 10-2 of Article 13 of the Act shall consider the estimated amount of expenses required for future benefits, the estimated amount of operational revenues, etc. so that fiscal balance is maintained on a long-term basis, and the detailed standards therefor shall be prescribed by Ordinance of the Ministry of Employment and Labor. <Amended on Apr. 13, 2022>

(3) An employer shall pay contributions regularly, at least once every year.

(4) The fees under paragraph (1) 2 shall be borne by the employer.

(5) Deleted. <Apr. 13, 2022>

(6) An employer who concludes a contract for operational management services with multiple retirement pension trustees shall select one of the retirement pension trustees as a representative retirement pension trustee (hereinafter referred to as "executive secretary") and require it to perform duties under each item of Article 22 (1) 3.

Article 5(Minimum Level of Reserves under Defined Benefit Retirement Pension Plans) #

(1) "Ratio prescribed by Presidential Decree" in the main clause, with the exception of the subparagraphs, of Article 16 (1) of the Act means the ratio prescribed by Presidential Decree, which shall be at least 80/100. <Amended on Apr. 13, 2022>

(2) "Ratio prescribed by Presidential Decree" in the proviso of Article 16 (1) of the Act means the ratio of reserves to the standard policy reserve defined in the main clause, with the exception of the subparagraphs, of Article 16 (1) of the Act (hereinafter referred to as "standard policy reserve") for the period of service provided to a business (hereinafter referred to as "period of past service") before the establishment of a retirement pension plan, if such period of past service is to be included in the period of contribution pursuant to Article 14 (2) of the Act, which is determined and publicly notified by the Minister of Employment and Labor according to the number of years of past service and the number of years that have passed since the contribution began. <Amended on Apr. 13, 2022>

Article 6(Notification of Financial Verification Results) #

(1) Upon comparing the amount of reserves calculated pursuant to Article 16 (2) of the Act and the minimum reserves under the main clause, with the exception of the subparagraphs, of Article 16 (1) of the Act (hereinafter referred to as “minimum reserves”), a retirement pension trustee shall provide notification to an employer, in writing, as to whether there is any deficiency in reserves, the current status of reserves and contributions paid, whether a financial stabilization plan has been formulated pursuant to Article 7 (2) 2, and other relevant information: Provided, That where the amount of reserves is smaller than the minimum reserves; if there is a trade union representing a majority of employees, such notification shall also be provided, in writing, to the labor union; and if there is no labor union representing a majority of the employees, such notification shall also be provided to all employees in writing or through an information and communications network. <Amended on Oct. 29, 2019; Apr. 13, 2022>

(2) A retirement pension trustee may request an employer to cooperate in the following matters in order to notify all employees pursuant to the proviso of paragraph (1): in such cases, the employer shall comply with such request, unless there is a compelling reason not to do so: <Newly Inserted on Oct. 29, 2019>

1. Providing access to the intranet operated by the employer;

2. Providing addresses or e-mail addresses of all employees;

3. Notifying all employees of the matters specified in the proviso of paragraph (1).

(3) Forms necessary for notification under paragraph (1) shall be determined and publicly notified by the Minister of Employment and Labor. <Amended on Oct. 29, 2019>

Article 7(Criteria for Determining Deficiency in Reserves, and Plans to Cover Deficiency) #

(1) "Level prescribed by Presidential Decree" in Article 16 (3) of the Act means 95/100 of the minimum reserves.

(2) Where the amount of reserves falls short of the level under paragraph (1), an employer shall cover the deficiency by taking the following measures, pursuant to Article 16 (3) of the Act: <Amended on Apr. 13, 2022>

1. The employer shall cover at least 1/3 of the deficiency from the minimum level of reserves within one year after the end of the immediately preceding business year by paying contributions, etc.;

2. The employer shall prepare a concrete plan (hereinafter referred to as "financial stabilization plan") containing measures to raise funds, payment plans, etc. to implement the measures under subparagraph 1 and shall retain such plan for three years;

3. Within 60 days from the date the employer is notified of the financial verification results pursuant to Article 6, he or she shall notify the labor union of the financial stabilization plan, if there is one joined by a majority of employees; or notify all employees and a retirement pension trustee of such plan, if there is no labor union joined by a majority of employees.

Article 8(Grounds for Exceptions to Paying Full Amount of Benefits) #

"Bankruptcy of a business or other cases prescribed by Presidential Decree" in the main clause of Article 17 (2) of the Act means the following cases: <Amended on Dec. 15, 2015; Apr. 13, 2022>

1. Where the business owner is declared bankrupt pursuant to the Debtor Rehabilitation and Bankruptcy Act;

2. Where the business owner receives a decision to commence individual rehabilitation procedures pursuant to the Debtor Rehabilitation and Bankruptcy Act;

3. Where the business owner falls under Article 5 (1) 2 or 3 of the Enforcement Decree of the Wage Claim Guarantee Act;

4. Where the ratio of reserve to the standard policy reserve is found to be below the ratio under Article 5 (1) according to verification results under Article 16 (2) of the Act; in such cases, even where the period of past service is included in the period of contribution, the ratio under Article 5 (1) shall be applicable;

5. Where the following values are not less than a ratio determined and publicly notified by the Minister of Employment and Labor;

6. Cases prescribed by Ordinance of the Ministry of Employment and Labor, in which other employees' entitlement to benefits is restricted if benefits are paid in full.

Article 9(Grounds for Exceptions to Transferring Benefits to Individual Retirement Pension Plans) #

"Ground prescribed by Presidential Decree exists, such as where an employee receives benefits upon retiring at the age of 55 or older" in the proviso of Article 17 (4) of the Act means the following cases: <Amended on Apr. 13, 2022>

1. Where a participant receives benefits upon retiring at the age of 55 or over;

2. Where a participant repays a loan, etc. secured against benefits pursuant to Article 7 (2) of the Act; in such cases, the amount not transferred to the account of the individual retirement pension plan, etc. designated by the participant shall not exceed the amount of secured loan to be repaid;

3. Where the amount of benefits does not exceed the amount determined by the Minister of Employment and Labor;

4. Cases falling under subparagraphs 3 through 5 of Article 3-2.

[Title Amended on Apr. 13, 2022]

Article 9-2(Composition of Reserves Operating Committee of Defined Benefit Plans) #

(1) A reserves operating committee under Article 18-2 (1) of the Act (hereafter in this Article referred to as “reserves operating committee") shall be composed of at least five but not more than seven members, including one chairperson.

(2) An executive officer in charge of retirement pension affairs in the relevant business shall serve as the chairperson of a reserves operating committee.

(3) The members of a reserves operating committee shall be appointed by the chairperson from among the following persons:

1. Persons elected by a trade union if there is a trade union representing a majority of the employees, or persons elected with the consent of a majority of the employees if such trade union does not exist;

2. The heads of departments related to retirement pension plans, such as fund management, financial accounting, personnel, and labor;

3. Persons who have experience or expertise in retirement pension and asset management;

4. Persons, other than those prescribed in subparagraphs 1 through 3, deemed necessary by the chairperson for the reasonable operation of the reserves.

(4) Notwithstanding paragraph (3), where the reserves fall short of the minimum reserve, at least one member falling under paragraph (3) 1 through 3 shall be included therein.

(5) Meetings of a reserves operating committee shall be held at least once a year.

(6) A meeting of a reserves operating committee shall be called when a majority of the members request or its chairperson deems it necessary, and the chairperson shall preside over the meeting.

(7) Except as provided in paragraphs (1) through (6), matters necessary for the composition of a reserves operating committee shall be determined and publicly notified by the Minister of Employment and Labor.

[This Article Newly Inserted on Apr. 13, 2022]

Article 9-3(Details of Reserves Operation Plans) #

"Matters prescribed by Presidential Decree, such as the purpose and methods of operation of the reserves, target rate of returns, and evaluation of the operational performance" in the latter part of Article 18-2 (2) of the Act means the following:

1. The purpose of operation of the reserves and target rate of returns;

2. The methods of operation of the reserves (including policies on distribution of assets and products available for investment);

3. The evaluation of the operational performance;

4. Matters regarding the operation and management of the reserves, including duties of persons in charge of the operation of the reserves.

[This Article Newly Inserted on Apr. 13, 2022]

Article 10(Matters to Be Stipulated in Defined Contribution Pension Rules) #

(1) "Matters prescribed by Presidential Decree" in Article 19 (1) 7 of the Act means the following:

1. Matters concerning payment of fees for performing operational management services and asset management services;

2. Matters concerning the methods, procedures, etc. for training participants.

(2) The fees under paragraph (1) 1 shall be borne by the employer: Provided, That the fees for additional contributions to be voluntarily borne by the participant pursuant to Article 20 (2) of the Act shall be borne by the participant.

(3) Deleted. <Apr. 13, 2022>

Article 11(Interest Rate for Unpaid Contributions) #

"Interest rate prescribed by Presidential Decree" in the latter part of Article 20 (3) of the Act means the following:

1. The period counted from the day next to the date set to pay a contribution, to the 14th day (where payment date is extended by mutual agreement between parties, such extended date) from the date a ground to pay a benefit occurs, such as retirement, etc. of a participant: 10/100 a year;

2. The period from the day following the period under subparagraph 1, to the date a contribution is paid: 20/100 a year.

Article 12(Grounds for Exceptions to Applying Interest on Delayed Payment) #

"Other cause prescribed by Presidential Decree" in Article 20 (4) of the Act means a case falling under any subparagraph of Article 18 of the Enforcement Decree of the Labor Standards Act.

Article 12-2(Grounds for Payment of Unpaid Contributions) #

"Cause prescribed by Presidential Decree" in the main clause of Article 20 (5) of the Act means a case where a participant retires from the relevant business.

[Moved from Article 13 <Jul. 11, 2022>]

Article 13(Requirements for Approving Default Option Schemes) #

(1) "Requirements prescribed by Presidential Decree" in the provisions, with the exception of the items, of Article 21-2 (1) 2 of the Act means the following requirements:

1. The operational details prescribed in any item of Article 21-2 (1) 2 of the Act in the investment prospectus shall be specified in the operational plan as key operational details;

2. Its asset distribution shall be appropriate, and its investment strategy shall be simple and easily understandable;

3. The possibility of loss caused by economic mid- to long-term changes, such as fluctuations in prices, interest rates, or exchange rates, shall be within the scope permitted in light of the characteristics of the group of participants;

4. Expected returns shall be secured at a reasonable level in light of the conditions of financial markets, such as interest rates and exchange rates;

5. The possibility of loss and expected returns shall achieve a reasonable balance in the mid- to long-term;

6. Expenses including fees shall not be excessive compared to the expected returns;

7. It shall be possible for a person to join the default option scheme at any time and to redeem it within 14 days from the date an application for redemption is filed, in the absence of exceptional circumstances.

(2) Detailed criteria regarding requirements provided in the subparagraphs of paragraph (1) shall be determined and publicly notified by the Minister of Employment and Labor.

[This Article Newly Inserted on Jul. 11, 2022]

[Previous Article 13 moved to Article 12-2 <Jul. 11, 2022>]

Article 13-2(Providing Participants with Information) #

(1) "Matters prescribed by Presidential Decree" in Article 21-3 (1) 3 of the Act means the following:

1. The following matters regarding default option schemes:

(a) Risk ratings, the possibility of loss, and the past rate of returns, of default option schemes;

(b) Matters regarding expenses including fees to be borne by participants;

(c) Matters regarding the protection of participants, such as the limit on protection of depositors;

(d) The possibility of changes in risk ratings of retirement pension assets following the application of default option schemes;

(e) Matters regarding approval, such as the date of approval for default option schemes;

2. The fact that default option schemes may be changed under Article 21-3 (6) of the Act and the procedures therefor.

(2) Details of matters provided in the subparagraphs of paragraph (1) shall be determined and publicly notified by the Minister of Employment and Labor.

(3) The provision of information under Article 21-3 (1) of the Act shall be made by any of the following means:

1. Sending information by mail;

2. Issuance in writing;

3. Transmission through an information and communications network;

4. Such other means equivalent to those provided in subparagraphs 1 through 3 as agreed by the parties.

[This Article Newly Inserted on Jul. 11, 2022]

Article 13-3(Notification of Operation of Reserves under Default Option Schemes) #

(1) In giving notice under Article 21-3 (3) of the Act, a retirement pension trustee shall specify the following in the notice:

1. The fact that the reserves of a participant shall be operated by the default option scheme under the former part of Article 21-3 (4) of the Act, if the participant fails to select the method of operating reserves by himself or herself within two weeks after receiving the notice;

2. Information regarding the default option scheme selected by a participant, as provided in Article 21-3 (1) 1 of the Act and the subparagraphs of Article 13-2 (1) of this Decree;

3. The fact that a participant may select by himself or herself the method of operating reserves at any time under Articles 21 (1) and 21-3 (5) of the Act.

(2) Notice under paragraph (1) shall be given by means specified in any subparagraph of Article 13-2 (3).

[This Article Newly Inserted on Jul. 11, 2022]

Article 13-4(Change of Default Option Schemes) #

(1) A retirement pension trustee who intends to change default option schemes pursuant to Article 21-3 (6) of the Act shall file an application for approval for the change with the Minister of Employment and Labor after prior deliberation by the Deliberative Committee (hereinafter referred to as the "Deliberative Committee") under Article 21-2 (2) of the Act.

(2) If a retirement pension trustee obtains approval to change default option schemes in accordance with an application prescribed in paragraph (1), such trustee shall notify the fact to a participant who has selected the relevant default option scheme as that applicable to himself or herself or a participant whose reserves are being operated by the default option scheme, within seven days from the date the trustee obtains approval to change default option schemes, by any of the methods specified in the subparagraphs of Article 13-2 (3).

(3) Notice under paragraph (2) shall include the following:

1. The reasons for changing default option schemes;

2. Information about the changed default option scheme, which specified in Article 21-3 (1) 1 of the Act and in the subparagraphs of Article 13-2 (1) of this Decree;

3. The fact that the reserves of the participant may be operated by the changed default option scheme from the date 14 days elapse after obtaining approval for change under the latter part of Article 21-3 (6) of the Act and paragraph (4) of this Article;

4. The fact that it is possible to select other methods of operating reserves instead of the changed default option scheme if the participant so desires;

5. The fact that the participant may select other methods of operating reserves by himself or herself even after the reserve is operated by the changed default option schemes pursuant to Articles 21 (1) and 21-3 (5) of the Act.

(4) Where a participant in receipt of notice under paragraph (2) or (3) fails to select a method of operating reserves other than default option schemes, the relevant retirement pension trustee may operate the participant's reserves by the changed default option schemes from the date 14 days elapse after obtaining approval for change under paragraph (1).

[This Article Newly Inserted on Jul. 11, 2022]

Article 13-5(Publication of Default Option Schemes) #

The Minister of Employment and Labor shall publish the following matters regarding default option schemes on the website, etc. of the Ministry of Employment and Labor at least once every quarter:

1. The amounts of reserves and the current status of operation;

2. The rates of returns.

[This Article Newly Inserted on Jul. 11, 2022]

Article 13-6(Revocation of Approval of Default Option Schemes) #

(1) In any of the following cases, the Minister of Employment and Labor may revoke approval of the relevant default option scheme after prior deliberation by the Deliberative Committee: Provided, That he or she shall revoke such approval in the case of subparagraph 1:

1. Where approval of a default option scheme has been obtained by fraud or other improper means;

2. Where the requirements for approval under the subparagraphs of Article 13 (1) cease to be met;

3. Where a default option scheme has caused significant damage to the reserves of a participant or it is deemed obviously foreseeable that a default option scheme would cause such damage.

(2) If approval of a default option scheme is revoked pursuant to paragraph (1), the relevant retirement pension trustee shall notify the following matters to a participant who has selected the relevant default option scheme as that applicable to himself or herself or whose reserves are being operated by the relevant default option scheme:

1. The grounds for revocation;

2. Matters regarding the methods and procedures for terminating the default option scheme, approval of which has been revoked;

3. Information on at least three operating methods, including other default option schemes, which is related to the matters specified in Article 21-3 (1) 1 of the Act and the subparagraphs of Article 13-2 (1) of this Decree.

(3) Where a participant in receipt of notification under paragraph (2) selects another operating method, the retirement pension trustee shall transfer the reserves of the participant into the operating method selected by the participant.

(4) A retirement pension trustee who transfers and operates reserves pursuant to paragraph (3) shall provide the participants with information on the operating method under which the transferred reserves are managed, with regard to the matters specified in Article 21-3 (1) 1 of the Act and the subparagraphs of Article 13-2 (1) of this Decree.

(5) Where a participant in receipt of notice under paragraph (2) fails to terminate the relevant default option scheme or to select any other operating method, the retirement pension trustee may transfer the reserves of the participant into any other default option scheme of the same risk grade as that of the previous default option scheme to operate the reserves.

Article 14(Grounds for Early Withdrawal from Defined Contribution Pension Plans) #

(1) "Grounds prescribed by Presidential Decree, such as housing purchases" in Article 22 of the Act means any of the following cases: <Amended on Dec. 15, 2015; Jul. 2, 2019; Oct. 29, 2019; Nov. 3, 2020>

1. Where Article 2 (1) 1, 1-2, or 5 (limited to where damage is caused by a disaster) is applicable;

1-2. Where a participant pays medical expenses in excess of 125/1,000 of his or her total annual wages in cases falling under Article 2 (1) 2;

2. Where a participant is declared bankrupt pursuant to the Debtor Rehabilitation and Bankruptcy Act within five years counted retroactively from the date he or she applies for early withdrawal;

3. Where a participant receives a decision to commence individual rehabilitation procedures pursuant to the Debtor Rehabilitation and Bankruptcy Act within five years counted retroactively from the date he or she applies for early withdrawal;

4. Where a participant who has been granted a loan secured by an entitlement to receive benefits of a retirement pension plan under the latter part of Article 7 (2) of the Act, intends to repay the principal and interest of the loan, which falls under the grounds determined and publicly notified by the Minister of Employment and Labor.

(2) If the reserve is withdrawn early due to any ground prescribed in paragraph (1) 4, the amount of early withdrawal shall not exceed the amount necessary for repaying the principal and interest of the relevant loan. <Newly Inserted on Nov. 3, 2020>

Article 15(Matters to Be Stipulated in Standard Rules) #

"Matters prescribed by Presidential Decree" in subparagraph 1 (b) of Article 23 of the Act means the following:

1. Characteristics of the defined contribution plan established under standard rules, and a name reflecting such matter;

2. The scope or characteristics of businesses eligible to join the defined contribution plan;

3. Methods of operating reserves, and the criteria for selection thereof. In such cases, methods of operating reserves and the criteria for selection thereof where a participant does not give directions for operation shall be included therein;

4. Matters concerning grounds, procedures, etc. for withdrawal from the defined contribution plan;

5. Matters concerning fees;

6. Other matters necessary for the reasonable operation of defined contribution plans involving at least two employers, which are determined by the Minister of Employment and Labor.

Article 15-2(Matters to Be Stipulated in Standard Contracts) #

"Matters prescribed by Presidential Decree" in subparagraph 2 of Article 23 of the Act means the following:

1. Matters concerning the implementation of standard rules under subparagraph 1 of Article 23 of the Act;

2. Matters concerning the calculation and payment of fees related to the operation of a defined contribution plan involving at least two employers;

3. Matters concerning grounds and procedures for termination or alteration of a contract for operational management services and asset management services;

4. Other matters necessary for the guarantee of a participant’s entitlement to benefits, which are determined and publicly notified by the Minister of Employment and Labor.

[Moved from Article 16 <Apr. 13, 2022>]

Article 16(Composition of Steering Committee for SME Retirement Pension Fund Plan) #

(1) Among members of the Steering Committee for the SME Retirement Pension Fund Plan under Article 23-2 (2) of the Act (hereinafter referred to as the "Steering Committee"), persons representing employees under paragraph (4) 2 of that Article shall be those recommended by a trade union which is a confederation, and persons representing employers under subparagraph 3 of that paragraph shall be those recommended by a nationwide employers' association.

(2) The chairperson of the Steering Committee (hereinafter referred to as the "chairperson") may dismiss an Steering Committee member from office if the member provided in the subparagraphs of Article 23-2 (4) of the Act falls under any of the following cases:

1. Where the member becomes unable to perform his or her duties due to a mental or physical disability;

2. Where the member commits irregularities related to his or her duties;

3. Where the member is deemed incompetent for the office due to neglect of duty, injury to dignity, or other grounds;

4. Where the member personally expresses his or her intent that fulfilling duties is impracticable.

[This Article Newly Inserted on Apr. 13, 2022]

[Previous Article 16 moved to Article 15-2 <Apr. 13, 2022>]

Article 16-2(Duties of Chairperson) #

(1) The chairperson shall represent the Steering Committee and have general supervision over and control of its affairs.

(2) If the chairperson is unable to perform his or her duties due to any unavoidable reason, a member designated in advance by the chairperson shall act on behalf of the chairperson.

[This Article Newly Inserted on Apr. 13, 2022]

[Previous Article 16-2 moved to Article 17 <Apr. 13, 2022>]

Article 16-3(Operation of Steering Committee) #

(1) The chairperson shall convene meetings of the Steering Committee and preside over the meetings.

(2) When the chairperson of the Operating Committee convenes a meeting, he or she shall notify each Operating Committee member of the date, time, and venue of the meeting and the agenda items not later than seven days before the opening of the meeting: Provided, That the period for such notice may be shortened, if it is required to hold a meeting urgently or if any unavoidable reason exists.

(3) A majority of the members of the Steering Committee shall constitute a quorum, and any decision thereof shall require the concurring vote of a majority of those present.

(4) The chairperson shall prepare and retain the minutes which record the date, time, venue, matters for deliberation and resolution of the meeting, and the details of statements of each attendant and shall make public the main contents of such minutes.

(5) The Steering Committee shall have one secretary, who shall be designated by the chairperson from among the employees of the Korea Workers' Compensation and Welfare Service established under Article 10 of the Industrial Accident Compensation Insurance Act (hereinafter referred to as the "Korea Workers' Compensation and Welfare Service").

(6) Allowances may be paid and travel expenses reimbursed to Steering Committee members who attend Steering Committee meetings within the budget: Provided, That the same shall not apply where an Steering Committee member who is a public official attends an Steering Committee meeting in direct connection with his or her duties.

(7) Except as provided in paragraphs (1) through (6), matters necessary for the operation of the Steering Committee shall be determined by the chairperson following resolution by the Steering Committee.

[This Article Newly Inserted on Apr. 13, 2022]

Article 16-4(Methods of Managing and Operating SME Retirement Pension Fund) #

(1) In order to ensure the stable operation and to enhance the profitability of the SME retirement pension fund under Article 23-3 (1) of the Act (hereinafter referred to as the "SME retirement pension fund"), the Korea Workers' Compensation and Welfare Service shall formulate a plan and guidelines for the operation of the SME retirement pension fund each year.

(2) The Korea Workers' Compensation and Welfare Service shall manage and operate the SME retirement pension fund in any of the following manners in accordance with the plan and guidelines for the operation of the SME retirement pension fund under paragraph (1); in such cases, it shall do so in good faith so that each type of asset can generate returns exceeding the market returns:

1. Deposits or trusts in the following financial institutions:

(a) Insurance companies under the Insurance Business Act;

(b) Communications agencies under the Postal Savings and Insurance Act;

(c) Banks under the Banking Act, the Korea Development Bank under the Korea Development Bank Act, the Industrial Bank of Korea under the Industrial Bank of Korea Act, the NongHyup Bank under the Agricultural Cooperatives Act, and the Suhyup Bank under the Fisheries Cooperatives Act;

(d) Investment traders, investment brokers, trust business entities, collective investment business entities, and merchant banks under the Financial Investment Services and Capital Markets Act;

2. Investment in the public sector through purchase of State bonds for public projects;

3. Trading and lending of securities under the Financial Investment Services and Capital Markets Act;

4. Transactions in the derivatives market for indexed financial investment instruments, among indexed products under Article 5 (1) 1 through 3 of the Financial Investment Services and Capital Markets Act;

5. Transactions of exchange-traded derivatives and over-the-counter derivatives under the Financial Investment Services and Capital Markets Act;

6. Investment in and financing of the collective investment scheme under the Financial Investment Services and Capital Markets Act;

7. Contributions to an institutional private equity fund for improving corporate structure under Article 20 of the Industrial Development Act;

Article 16-5(Accounting of SME Retirement Pension Fund) #

Details necessary for the accounting of the SME retirement pension fund shall be determined by the Korea Workers' Compensation and Welfare Service, with approval from the Minister of Employment and Labor.

[This Article Newly Inserted on Apr. 13, 2022]

Article 16-6(Scope of Utilizing Data) #

"Data collected pursuant to the Employment Insurance Act, the Act on the Collection of Premiums for Employment Insurance and Industrial Accident Compensation Insurance, and the Framework Act on Labor Welfare within the scope prescribed by Presidential Decree" in the provisions, with the exception of the subparagraphs, of Article 23-4 (1) of the Act means the following data:

1. Data about reporting the insured status under Article 15 of the Employment Insurance Act;

2. Data about reporting insurance relationships referred to in Article 11 of the Act on the Collection of Insurance Premiums for Employment Insurance and Industrial Accident Compensation Insurance and data about reporting changes in insurance relationships referred to in Article 12 of that Act;

3. Data about calculating monthly insurance premiums for individual employees under Article 16-3 of the Act on the Collection of Insurance Premiums for Employment Insurance and Industrial Accident Compensation Insurance, data about the settlement of insurance premiums under Article 16-9 of that Act, data about reporting total remuneration, etc. under Article 16-10 of that Act, data about revised reports under Article 16-11 of that Act, and data about reporting and settling finalized insurance premiums of construction business, etc. under Article 19 of that Act;

4. The following data among the data provided to the Korea Workers' Compensation and Welfare Service under Article 40 of the Act on the Collection of Insurance Premiums for Employment Insurance and Industrial Accident Compensation Insurance:

(a) Data about reporting by workplaces and data about the amounts of monthly insurance contributions for employees insured under the National Health Insurance Act;

(b) Data about reporting by workplace-based insured persons and data about the imposition of monthly pension contributions under the National Pension Act;

(c) Business registration data under the Value-Added Tax Act;

(d) Data about reporting on global income in the reports on the status of withholding, in the statement of payments of wages and salary income, and in the final returns on the tax base for global income tax under the Income Tax Act;

(e) Data about remuneration and the amount thereof in the standard income statement under the Corporate Tax Act;

(f) Resident registration data under the Resident Registration Act.

Article 16-7(Affairs Utilizing Data) #

"Affairs prescribed by Presidential Decree" in Article 23-4 (1) 2 of the Act means the following:

1. The following affairs regarding employers:

(a) Sharing and calculating contributions;

(b) Guidance on methods for paying contributions;

(c) Imposing fees under Article 23-6 (2) of the Act;

(d) Verifying requirements for the State's subsidization of employer’s contributions and expenses incurred in operating the SME retirement pension fund under Article 23-14 (1) of the Act and Article 16-15 of this Decree;

2. The following affairs regarding participants:

(a) Guidance on joining a retirement pension plan;

(b) Verifying eligibility requirements;

(c) Verifying grounds for payment of benefits, such as retirement;

(d) Guidance on procedures for paying benefits.

[This Article Newly Inserted on Apr. 13, 2022]

Article 16-8(Matters to Be Entered in Standard Contracts for SME Retirement Pension Fund) #

"Matters prescribed by Presidential Decree" in Article 23-5 (1) 6 of the Act means the following:

1. Matters regarding fees which the Korea Workers' Compensation and Welfare Service imposes on employers and participants under Article 23-6 (2) of the Act;

2. Matters regarding State’s subsidization of employer’s contributions and expenses incurred in operating the SME retirement pension fund under Article 23-14 (1) of the Act and Article 16-15 of this Decree;

3. Matters regarding the methods of training conducted by the Korea Workers' Compensation and Welfare Service under Article 23-15 (1) of the Act.

[This Article Newly Inserted on Apr. 13, 2022]

Article 16-9(Approval for Standard Contract for SME Retirement Pension Fund and Approval for Change Thereof) #

(1) Where the Korea Workers' Compensation and Welfare Service intends to obtain approval for a standard contract for the SME retirement pension fund under Article 23-5 (1) of the Act, it shall submit an application for approval to the Minister of Employment and Labor, accompanied by the following documents:

1. A draft standard contract for the SME retirement pension fund;

2. Results of deliberation and resolution by the Steering Committee.

(2) Where the Korea Workers' Compensation and Welfare Service intends to obtain approval for change of the standard contract for the SME retirement pension fund under the main clause of Article 23-5 (2) of the Act, it shall submit an application for approval for change stating the details of and reasons for the change, to the Minister of Employment and Labor, accompanied by the results of deliberation and resolution by the Steering Committee.

(3) Where the Korea Workers' Compensation and Welfare Service intends to report the change of the standard contract for the SME retirement pension fund under the proviso of Article 23-5 (2) of the Act, it shall submit a report on change stating the details of and reasons for the change, to the Minister of Employment and Labor, within seven days from the date of change.

(4) The Korea Workers' Compensation and Welfare Service shall notify an employer of the standard contract of the SME retirement pension fund, for which approval or approval for change has been granted or a report on change has been filed pursuant to paragraphs (1) through (3), by any of the following means:

1. Sending information by mail;

2. Issuance in writing;

3. Transmission through an information and communications network.

[This Article Newly Inserted on Apr. 13, 2022]

Article 16-10(Processing of Some of Affairs of the Korea Workers' Compensation and Welfare Service) #

(1) “Affairs prescribed by Presidential Decree” in Article 23-6 (3) of the Act means the affairs provided in Article 23-5 (1) 3 and 5 of the Act.

(2) "Person who fulfills the requirements prescribed by Presidential Decree, such as personnel and physical requirements" in Article 23-6 (3) of the Act means a person who meets the following requirements:

1. Affairs provided in Article 23-5 (1) 3 of the Act: The following persons:

(a) A collective investment business entity that has obtained authorization for financial investment business under Article 12 of the Financial Investment Services and Capital Markets Act;

(b) A person who has obtained authorization for financial investment business as an investment trader or investment broker under Article 12 of the Financial Investment Services and Capital Markets Act, among persons who has filed for registration of financial investment business as a discretionary investment business entity under Article 18 of that Act;

2. Affairs provided in Article 23-5 (1) 5 of the Act: Communications agencies under the Postal Savings and Insurance Act, banks under the Banking Act, Korea Development Bank under the Korea Development Bank Act, Industrial Bank of Korea under the Industrial Bank of Korea Act, NongHyup Bank under the Agricultural Cooperatives Act, and Suhyup Bank under the Fisheries Cooperatives Act.

[This Article Newly Inserted on Apr. 13, 2022]

Article 16-11(Methods of Payment of Employer Contributions) #

(1) The Korea Workers' Compensation and Welfare Service may provide users with information on methods of the payment of employer contributions under the former part of Article 23-7 (1) of the Act and interest on arrears under the latter part of that paragraph through information and communications networks.

(2) "Where grounds prescribed by Presidential Decree, such as retirement of the participant of the SME retirement pension fund, occur" in the main clause of Article 23-7 (2) of the Act means the time the participant of the SME retirement pension fund plan retires from the relevant business.

[This Article Newly Inserted on Apr. 13, 2022]

Article 16-12(Limit on Payment of Participant Contributions) #

The limit on the amount of participant contributions to be paid under subparagraph 2 of Article 23-8 of the Act shall be the amount referred to in Article 40-2 (2) 1 of the Enforcement Decree of the Income Tax Act.

[This Article Newly Inserted on Apr. 13, 2022]

Article 16-13(Methods of Providing Information on Fund Operation) #

"Manner prescribed by Presidential Decree" in Article 23-10 of the Act means any of the following methods:

1. Sending information by mail;

2. Issuance in writing;

3. Transmission through an information and communications network.

[This Article Newly Inserted on Apr. 13, 2022]

Article 16-14(Requirements for Entitlement to Participant Contribution Account of Fund Plan) #

Pursuant to Article 23-12 (1) 2 of the Act, Article 18 (1) shall apply mutatis mutandis to the types of benefits and eligibility requirements for a participant contribution account of fund plan under the former part, with the exception of the subparagraphs, of Article 23-8 of the Act (hereinafter referred to as "participant contribution account of fund plan"). In such cases, "Article 24 (5) of the Act" shall be construed as "Article 23-12 (1) 2 of the Act", and "individual retirement pension plan" as "participant contribution account of fund plan".

[This Article Newly Inserted on Apr. 13, 2022]

Article 16-15(Subject Matters of Subsidization) #

(1) The subject matters of subsidization under Article 23-14 (1) of the Act shall be employer contributions and expenses incurred in operating the SME retirement pension fund plan.

(2) The level of subsidization under Article 23-14 (1) of the Act shall be determined and publicly notified by the Minister of Employment and Labor within the scope of employer contributions and expenses incurred in operating the SME retirement pension fund plan.

[This Article Newly Inserted on Apr. 13, 2022]

Article 16-16(Procedures for Filing Applications for Subsidies and Methods of Payment) #

(1) Where an employer intends to receive support under Article 23-14 (1) of the Act, he or she shall prepare an application for subsidies and submit it to the Minister of Employment and Labor.

(2) Upon receipt of an application under paragraph (1), the Minister of Employment and Labor shall transfer the subsidy to the employer's account if the employer meets the requirements for support referred to in Article 23-14 (1) of the Act.

[This Article Newly Inserted on Apr. 13, 2022]

Article 16-17(Recovery of Subsidies) #

(1) The criteria for the amount of subsidies that the Minister of Employment and Labor may recover pursuant to Article 23-14 (3) of the Act shall be as follows for each reason for recovery:

1. In cases falling under Article 23-14 (3) 1 of the Act: The total amount of the subsidy granted;

2. In cases falling under Article 23-14 (3) 2 of the Act: The total amount of the subsidy erroneously paid;

3. In cases falling under Article 23-14 (3) 3 of the Act: The total amount of the subsidy granted.

(2) Where any ground for recovery prescribed in any subparagraph of Article 23-14 (3) of the Act arises, the Korea Workers' Compensation and Welfare Service shall notify the relevant employer who has received the subsidy of such fact, and shall give written notice of the amount to be recovered and the deadline for and method of payment and collect such amount.

(3) "Cause prescribed by Presidential Decree, such as bankruptcy" in Article 23-14 (3) 3 of the Act means the following:

1. Bankruptcy (referring to where a business owner obtains recognition of the fact of bankruptcy, etc. pursuant to Article 5 (1) of the Enforcement Decree of the Wage Claim Guarantee Act);

2. Bankruptcy or the commencement of individual rehabilitation procedures (referring to where a business owner receives a declaration of bankruptcy or a decision to commence individual rehabilitation procedures in accordance with the Debtor Rehabilitation and Bankruptcy Act);

3. Change to another retirement benefit scheme;

4. Other good causes prescribed by Ordinance of the Ministry of Employment and Labor for which the SME retirement pension fund plan can be abolished, such as business closure.

(4) "Amount prescribed by Presidential Decree" in the proviso, with the exception of the subparagraphs, of Article 23-14 (3) of the Act means 3,000 won.

[This Article Newly Inserted on Apr. 13, 2022]

Article 16-18(Scope of Data Subject to Request) #

"Data prescribed by Presidential Decree, such as data on taxation of property tax under the Local Tax Act" in the former part of Article 23-14 (5) of the Act means the following data:

1. A certificate of income;

2. A certified transcript or abstract of a resident registration card;

3. Electronic data from family relationship registration;

4. A certificate of taxation by local tax item;

5. A motor vehicle register and construction machinery register;

6. A building registration certificate and a land registration certificate;

7. A corporation registration certificate.

[This Article Newly Inserted on Apr. 13, 2022]

Article 16-19(Content of Training for Participants) #

"Matters prescribed by Presidential Decree, such as the operational status of the SME retirement pension fund plan" in Article 23-15 (1) of the Act means the following:

1. The following matters in cases of a participant of business that has established the SME retirement pension fund plan:

(a) Matters provided in Article 32 (1) 1; in such cases, "retirement pension plan" in Article 32 (1) 1 (b) and (f) shall be construed as "SME retirement pension fund plan";

(b) The level of employer contributions, timing for payment, and status of payment;

(c) The operating status of the SME retirement pension fund plan;

2. The following matters in cases of a participant who has established a participant contribution account of fund plan:

(a) The limit on the amount of payment to a participant contribution account of fund plan under Article 16-12;

(b) Requirements for the entitlement to a participant contribution account of fund plan under Article 16-14;

(c) Matters provided in Article 32 (1) 1 (e) and (g);

(d) The operating status of the SME retirement pension fund plan.

[This Article Newly Inserted on Apr. 13, 2022]

Article 16-20(Publication of SME Retirement Pension Fund Plan) #

(1) The Korea Workers' Compensation and Welfare Service shall publish the following matters on its website pursuant to Article 23-15 (2) of the Act:

1. The following matters regarding the performance of the SME retirement pension fund plan:

(a) Matters regarding the operation of the SME retirement pension fund plan (including the current status on the size of the relevant business or workplace and on the participants and reserves);

(b) Matters regarding payment of benefits (including eligibility requirements for each type of benefits and the current status of early withdrawal);

2. The operating status and the rate of returns of the SME retirement pension fund;

3. The standard contract for the SME retirement pension fund plan under Article 23-5 (1) of the Act;

4. Other matters deemed necessary to be published for the protection of participants, which are determined and publicly notified by the Steering Committee.

(2) The deadline for publication under paragraph (1) shall be as follows:

1. Matters provided in subparagraphs 1 and 2: Within one month after the end of each quarter;

2. Matters provided in subparagraph 3: Within seven days from the date the standard contract for the SME retirement pension fund is approved or changed;

3. Matters provided in subparagraph 4: Within seven days from the date the Steering Committee determines that publication is necessary.

[This Article Newly Inserted on Apr. 13, 2022]

Article 16-21(Corrective Orders) #

(1) Where the Minister of Employment and Labor orders the Korea Workers' Compensation and Welfare Service to make a correction under Article 23-16 of the Act, he or she may order it to correct the relevant violation within a specified period of up to 90 days.

(2) Where the Minister of Employment and Labor issues a corrective order under paragraph (1), he or she shall do so in writing specifying the following:

1. The grounds for the corrective order;

2. Details of the corrective order;

3. The period of correction.

[This Article Newly Inserted on Apr. 13, 2022]

Article 17(Eligibility for Individual Retirement Pension Plans) #

“Person prescribed by Presidential Decree as requiring a stable source of old-age income, such as a sole proprietor” in Article 24 (2) 3 of the Act means any of the following persons:

1. A sole proprietor;

2. Any of the following employees for whom an individual retirement pension plan has not been set up according to the proviso of Article 4 (1) of the Act:

(a) An employee who has continuously worked for less than one year;

(b) An employee whose prescribed weekly working hours averaged over 4 weeks are less than 15 hours;

3. An employee who is under a retirement allowance system prescribed in Article 8 (1) of the Act;

4. A public official who is subject to the Public Officials Pension Act;

5. A soldier who is subject to the Military Pension Act;

6. A teacher or staff member who is subject to the Pension for Private School Teachers and Staff Act;

7. An employee of a special post office, who is subject to the Special Post Offices Act.

[This Article Newly Inserted on Apr. 18, 2017]

[Moved from Article 16-2; previous Article 17 moved to Article 17-2 <Apr. 13, 2022>]

Article 17-2(Limit on Contributions to Individual Retirement Pension Plans) #

"Limit prescribed by Presidential Decree" in the proviso of Article 24 (3) of the Act means the amount provided in Article 40-2 (2) 1 of the Enforcement Decree of the Income Tax Act, excluding the lump-sum benefits, etc. under a retirement benefit scheme (referring to the sum of contributions where the individual retirement pension plan has several accounts). <Amended on Dec. 15, 2015; Apr. 13, 2022>

[Moved from Article 17 <Apr. 13, 2022>]

Article 18(Requirements for Entitlement to Each Type of Benefits under Individual Retirement Pension Plans, and Early Withdrawal) #

(1) The requirements for entitlement to each type of benefits of individual retirement pension plans under Article 24 (5) of the Act shall be as follows:

1. Annuity: To be paid to participants aged 55 or older. In such cases, the payment period shall be at least five years;

2. Lump-sum benefit: To be paid to participants aged 55 or older who wish to be paid in a lump sum.

(2) Where a participant falls under any of the following, he or she may withdraw his or her reserves of an individual retirement pension plan early pursuant to Article 24 (5) of the Act: <Amended on Dec. 15, 2015; Nov. 3, 2020; Apr. 13, 2022>

1. Where he or she falls under Article 2 (1) 1;

2. Where he or she falls under the former part of Article 2 (1) 1-2; Provided, That a participant of an individual retirement pension plan under Article 25 of the Act may withdraw his or her reserves only once during the period of working in the same business;

3. Where he or she falls under Article 2 (1) 2: Provided, That a participant of an individual retirement pension plan under Article 25 of the Act may withdraw his or her reserves only when such participant bears medical expenses in excess of 125/1,000 of his or her total annual wages;

4. Where he or she falls under Article 2 (1) 5 (limited to where he or she has suffered damage from a disaster);

5. Where he or she is declared bankrupt in accordance with the Debtor Rehabilitation and Bankruptcy Act within five years counted retroactively from the date he or she applies for early withdrawal;

6. Where he or she receives a decision to commence individual rehabilitation procedures in accordance with the Debtor Rehabilitation and Bankruptcy Act within five years counted retroactively from the date he or she applies for early withdrawal;

7. Where he or she falls under Article 14 (1) 4.

(3) Where a participant withdraws his or her reserves early for a reason specified in paragraph (2) 7, the amount of early withdrawal shall not exceed the amount necessary for repaying the principal and interest of the loan. <Newly Inserted on Apr. 13, 2022>

Article 19(Special Cases on Business Employing Fewer than 10 Employees) #

(1) The requirements for entitlement to each type of benefits of individual retirement pension plan under Article 25 of the Act shall be as listed in the subparagraphs of Article 17 (1) of the Act.

(2) Fees incurred due to contributions paid by an employer pursuant to Article 25 (2) 2 of the Act shall be borne by the employer; and fees for an additional contribution paid additionally by him or her pursuant to subparagraph 3 of that paragraph shall be borne by him or her.

(3) "Cause prescribed by Presidential Decree" in the main clause of Article 25 (3) of the Act means a case where a participant retires from the relevant business.

Article 20(Requirements for Registration for Retirement Pension Trustees) #

(1) "Requirements prescribed by Presidential Decree, such as financial soundness, personnel and physical resource requirements" in the provisions, with the exception of the subparagraphs, of Article 26 of the Act means the following requirements: <Amended on Nov. 3, 2020>

1. The person shall meet the following requirements for financial soundness:

(a) A person who falls under subparagraphs 1 through 3 or subparagraph 7 of Article 26 of the Act: That his or her equity ratio under Article 10 (1) of the Act on the Structural Improvement of the Financial Industry (hereafter referred to as "equity ratio" in this Article) shall be the same as or higher than the level determined and publicly notified by the Financial Services Commission pursuant to paragraph (2) of that Article;

(b) A person who falls under subparagraph 4 or 5 of Article 26 of the Act: That his or her equity ratio shall be above the level applicable to a person with the most similar duties, financial structure, etc. among persons falling under subparagraphs 1 through 3 and 7 of Article 26 of the Act;

(c) A person who falls under subparagraph 6 of Article 26 of the Act: That he or she shall have legal grounds to receive a contribution from a fund established under an Act;

2. The person shall employ necessary personnel, such as those with expertise in operational management services or asset management services, computer personnel required for the performance of duties, etc. as determined and publicly notified by the Financial Services Commission: Provided, That where part of operational management services is entrusted to another person pursuant to Article 28 (2) of the Act, personnel for such services shall be deemed employed;

3. The person shall be equipped with computer facilities and an office necessary for the performance of operational management services or asset management services determined and publicly notified by the Financial Services Commission. In such cases, the computer facilities shall have supplementary facilities so that continuity of services is ensured in case of an accident, such as blackout, fire, etc., and a computer system shall be constructed beforehand lest any damage should occur to participants due to changes, etc. in the details of the system.

(2) Notwithstanding the proviso of paragraph (1) 2, a retirement pension trustee who intends to perform the services under Article 28 (1) 2 of the Act shall employ a pension accounting specialist satisfying all of the following qualifications as determined and publicly notified by the Financial Services Commission: <Amended on Apr. 13, 2022>

Article 21(Protection Measures for Pension Holders Following Revocation of Registration) #

" Measures prescribed by Presidential Decree to protect the participants” in Article 27 (4) of the Act means the following:

1. Notifying employers and participants of revocation or cancellation of registration and the details of measures to protect participants;

2. Indemnifying employers and participants against financial losses following termination or alteration of a contract for operational management services or asset management services;

3. Providing data, etc. necessary to transfer reserves to another retirement pension trustee and to continuously operate the relevant business and participants’ retirement pension plan pursuant to Article 27 (5) of the Act;

4. Other measures determined by the Minister of Employment and Labor as necessary to prevent unreasonable damage employers or participants may suffer.

Article 22(Scope of Operational Management Services) #

(1) "Service prescribed by Presidential Decree" in Article 28 (1) 5 of the Act means the following: <Amended on Nov. 3, 2020>

1. Establishing and operating an individual retirement pension plan under Article 24 of the Act;

2. Providing training entrusted by an employer pursuant to the latter part of Article 32 (2) of the Act;

3. The following services where a retirement pension trustee is an executive secretary:

(a) Verification of whether the employer has secured the ability to pay benefits under Article 16 of the Act, and notifying the results;

(b) Calculation of contributions under Article 4 (1) 1;

(c) Services of transmitting an employer's instructions regarding selection of a retirement pension trustee who pays benefits, to the retirement pension trustee, where grounds to pay benefits occur, such as retirement, etc.;

(d) Other matters necessary to stably and uniformly operate a plan such as registration of new participants, notification of current status of reserves, operations, etc., if a contract for the operational management services of a defined benefit plan has been concluded with multiple retirement pension trustees.

(2) A retirement pension trustee who is not an executive secretary shall cooperate with an executive secretary in the provision of data necessary for performing the services under paragraph (1) 3.

Article 23(Partial Entrustment of Operational Management Services) #

(1) "Some of the services prescribed by Presidential Decree" in Article 28 (2) of the Act means the services under Article 28 (1) 2 through 4 of the Act and the services under Article 22 (1) 2.

(2) "Requirements prescribed by Presidential Decree, such as personnel and physical resource requirements, etc." in Article 28 (2) of the Act means the requirements, the detailed standards of which are to be determined and publicly notified by the Financial Services Commission pursuant to Article 20 (3).

Article 24(Types of Contracts to Provide Asset Management Services) #

"Insurance contract or trust contract prescribed by Presidential Decree" in Article 29 (2) of the Act means an insurance contract operated as a special account under Article 108 of the Insurance Business Act or a specified money trust contract under subparagraph 1 of Article 103 of the Enforcement Decree of the Financial Investment Services and Capital Markets Act, meeting all of the following:

1. That, pursuant to Article 16 (4) of the Act, the amount of reserves shall exceed 150/100 of the standard policy reserve, and the retirement pension trustee shall return the difference to the employer if the employer requests such;

2. That benefits shall be paid to participants upon their retirement;

3. That a participant shall be allowed to directly claim the benefits to a retirement pension trustee: Provided, That no participant whose period of continuous service is less than one year shall be allowed to request the payment of benefits, and the reserves shall be vested in the employer;

4. That the reserves shall be paid to participants where a contract is terminated: Provided, That the reserves for a participant whose period of continuous service is less than one year shall belong to the employer.

Article 24-2(Standards for Imposition of Fees) #

(1) “Standards for imposition ... prescribed by Presidential Decree” in Article 29-2 (2) of the Act means the following:

1. Fees shall be imposed in consideration of the classification of duties and the expenses to be incurred in performing the relevant duties prescribed in the subparagraphs of Articles 28 (1) and 29 (1) of the Act;

2. Fees for performing duties related to profits and losses incurred in the operation of the reserves shall be imposed in consideration of such profits and losses;

3. Benefits for the reduction of or exemption from fees shall be provided to the employers or participants of the following enterprises:

(a) Small and medium enterprises under Article 2 of the Framework Act on Small and Medium Enterprises;

(b) Social enterprises under the Social Enterprise Promotion Act.

(2) Details of the standards provided in the subparagraphs of paragraph (1) shall be determined and publicly notified by the Minister of Employment and Labor.

(3) "Data prescribed by Presidential Decree, such as the standards for imposition of fees" in Article 29-2 (3) of the Act means the following data:

1. Standards for imposition of fees;

2. Current status of imposition of fees for providing operational management services and asset management services;

3. Expenses incurred in providing operational management services and asset management services;

4. Operating profits and losses of the reserves.

[This Article Newly Inserted on Jul. 11, 2022]

Article 25(Management Methods Guaranteeing Principal of and Interest on Reserves against Defined Contribution Retirement Pension Plans and Individual Retirement Pension Plans) #

(1) "Operating method guaranteeing the payment of principal and interest as prescribed by Presidential Decree" in Article 30 (2) 4 of the Act means the following: <Amended on Apr. 13, 2022>

1. The following management methods provided by a financial institution with a credit rating grade the same as or above that determined and publicly notified by the Financial Services Commission:

(a) Deposits and installment savings handled by a bank under Article 2 (1) 2 of the Banking Act;

(b) Insurance contracts handled by an insurance company under subparagraph 6 of Article 2 of the Insurance Business Act, which guarantee the payment of principal and interest in the form of guaranteeing the minimum interest rate on reserves, etc.;

(c) Contracts for which the payment of principal and interest is guaranteed by a financial investment business entity under Article 8 of the Financial Investment Services and Capital Markets Act, which are purchase and resale agreements under subparagraph 3 (b) of Article 85 of the Enforcement Decree of that Act;

(d) Deposits handled by a securities finance company under the Financial Investment Services and Capital Markets Act pursuant to Article 330 (1) of that Act;

2. Deposits handled by a communications agency pursuant to the Postal Savings and Insurance Act;

3. Bank of Korea currency stabilization securities and national bonds under Article 69 (1) of the Bank of Korea Act; national bonds; and bonds for which payment of principal and interest is guaranteed by the government;

3-2. Among asset-backed securities issued by a special purpose company defined in the Asset-Backed Securitization Act, social infrastructure bonds, the redemption of the principal and interest of which is guaranteed by the Infrastructure Credit Guarantee Fund established under Article 30 of the Act on Public-Private Partnerships in Infrastructure;

4. Other management methods by which payment of principal and interest is guaranteed, which are determined and publicly notified by the Financial Services Commission.

(2) Where the Financial Services Commission intends to determine or alter the credit rating grade under paragraph (1) 1 and the management methods under subparagraph 4 of that paragraph, it shall have consultation with the Minister of Employment and Labor.

Article 26(Operating Methods and Standards for Stable Operation of Reserves) #

(1) "Operating methods and standards prescribed by Presidential Decree" in Article 30 (2) 5 of the Act means the following operating methods and standards: <Amended on Mar. 23, 2015; Apr. 13, 2022>

1. Operating methods: Any of the following operating methods:

(a) Deposits and installment savings handled by banks under Article 2 (1) 2 of the Banking Act;

(b) Insurance contracts that allow a return of reserves and are publicly notified by the Financial Services Commission, among those handled by an insurance company under subparagraph 6 of Article 2 of the Insurance Business Act;

(c) Securities under Article 4 of the Financial Investment Services and Capital Markets Act, which are publicly notified by the Financial Services Commission. In such cases, the securities (excluding the collective investment securities under the Financial Investment Services and Capital Markets Act) shall not be those issued by employers or interested parties determined and publicly notified by the Financial Services Commission;

(d) Deposits handled by a communications agency under the Postal Savings and Insurance Act;

(e) Deposits handled by a securities finance company pursuant to Article 330 (1) of the Financial Investment Services and Capital Markets Act, the credit rating, etc. of which is at least the threshold prescribed and publicly notified by the Financial Services Commission among securities finance companies under that Act;

(f) Among asset-backed securities issued by a special purpose company defined in the Asset-Backed Securitization Act, social infrastructure bonds, the redemption of the principal and interest of which is guaranteed by the Infrastructure Credit Guarantee Fund established under Article 30 of the Act on Public-Private Partnerships in Infrastructure;

(g) Other management methods necessary for a stable mid- to long-term operation of reserves, which are determined and publicly notified by the Financial Services Commission;

2. Standards: The following standards shall be followed:

(a) Except for the management method guaranteeing payment of principal and interest under each subparagraph of Article 25 (1) and the management method whose investment risk is lowered by diversified investment in securities, etc., which are publicly notified by the Financial Services Commission, among the management methods under the items of subparagraph 1, operation shall be implemented within the total investment limits prescribed by Ordinance of the Ministry of Employment and Labor. In such cases, the Financial Services Commission may determine and publicly notify different detailed investment limits for each retirement pension plan within the total investment limits prescribed by Ordinance of the Ministry of Employment and Labor;

Article 27(Scope of Entrustment of Solicitation Services) #

"Services prescribed by Presidential Decree" in the provisions, with the exception of the subparagraphs, of Article 31 (1) of the Act means the following: <Amended on Dec. 15, 2015; Oct. 29, 2019>

1. Explaining a retirement pension plan and operation thereof to persons who have established or joined a retirement pension plan (including persons who intend to establish or join a retirement pension plan);

2. Introducing or connecting an employer or prospective participant to a retirement pension trustee;

3. Explaining the methods of operating reserves or providing relevant information to employers or participants (including prospective participants; hereafter in this Article, the same shall apply), and delivering instructions on the methods of operating the reserves of employers or participants;

4. Transmitting inquiries made by employers or participants and answers given by retirement pension trustees, etc.;

5. Other matters necessary for establishing retirement pension plans and soliciting persons to join a retirement pension plan, which are determined by the Minister of Employment and Labor.

Article 28(Requirements for Retirement Pension Plan Solicitors) #

(1) "Requirements prescribed by Presidential Decree" in Article 31 (1) 2 of the Act means the following:

1. That he or she shall not be an executive officer or employee of a retirement pension trustee, and shall be entrusted with solicitation services by a retirement pension trustee under a written contract with the retirement pension trustee;

2. That he or she shall be any of the following persons and shall complete a training program determined by the Minister of Employment and Labor: In such cases, the details of the training program and completion thereof shall be as listed in attached Table 1:

(a) An insurance solicitor, or an insurance agent who is an individual, registered with the Financial Services Commission pursuant to Article 84 or 87 of the Insurance Business Act, with experience in the relevant field for at least one year;

(b) An investment solicitor registered with the Korea Financial Investment Association pursuant to Article 51 of the Financial Investment Services and Capital Markets Act, with experience in the relevant field for at least one year;

(c) Other persons deemed by the Minister of Employment and Labor to have expertise in the retirement pension plan.

(2) The training under paragraph (1) 2 shall be entrusted to an institution having personnel, facilities, and equipment prescribed by Ordinance of the Ministry of Employment and Labor, and matters necessary to complete the training program, etc. shall be determined by the Minister of Employment and Labor.

(3) A retirement pension trustee shall require a retirement pension plan solicitor registered pursuant to Article 31 (2) of the Act (hereinafter referred to as "retirement pension plan solicitor") to take refresher training under attached Table 2 within six months from each second anniversary counting from the date such solicitor is registered.

Article 29(Entrustment of Registration of Solicitors) #

(1) Pursuant to the latter part of Article 31 (2) of the Act, the Minister of Employment and Labor may designate an agency from among the agencies designated by the Financial Services Commission according to the procedures determined by the Minister of Employment and Labor, with the personnel, facilities, and equipment determined by the Minister of Employment and Labor, and may entrust the agency with the registration of retirement pension plan solicitors.

(2) The Minister of Employment and Labor may determine the period of entrusting the registration of solicitors under paragraph (1) within the range not to exceed three years.

Article 30(Matters to Be Observed by Retirement Pension Plan Solicitors) #

(1) Pursuant to Article 31 (7) 2 of the Act, no retirement pension plan solicitor shall perform any of the following: <Amended on Oct. 29, 2019>

1. Implementing solicitation using a name other than retirement pension plan solicitor or another retirement pension plan solicitor's name;

2. Implementing solicitation based on falsehood, by telling false information or by not notifying interested parties of material facts;

3. Implementing solicitation beyond the scope of entrusted solicitation services under Article 27;

4. Concluding solicitation entrustment contracts with two or more retirement pension trustees;

5. Using the information, etc. that he or she has learned in the course of solicitation services for his or her or a third party's interest;

6. Concluding a contract as an agent of a retirement pension trustee who entrusted him or her with solicitation services or of an employer who plans to join a retirement pension plan, etc.;

7. Receiving money, securities, or other articles with property value from an employer who has established or intends to establish a retirement pension plan, or from a participant;

8. Providing or promising to provide extraordinary benefit under Article 33 (4) 2 of the Act to an employer who has established or intends to establish a retirement pension plan, a participant, or a person who is their interested party;

9. Giving instructions, by proxy, on the methods of operating the reserves of employers or participants;

10. Other matters determined and publicly notified by the Minister of Employment and Labor to protect employers and participants and to maintain sound and orderly trade practices.

(2) Where a retirement pension plan solicitor implements solicitation pursuant to Article 31 (7) 2 of the Act, he or she shall post a sign or certificate in his or her office indicating that he or she is entrusted with solicitation or present such sign or certificate to the other party; and shall first notify employers, etc. of the matters necessary to protect employers and participants and to maintain sound and orderly trade practices, such as the name of retirement pension trustee who entrusted him or her with solicitation, etc., which are determined and publicly notified by the Minister of Employment and Labor.

Article 31(Responsibilities of Employers for Stable Operation of Retirement Benefit Schemes) #

"Matters prescribed by Presidential Decree" in Article 32 (1) of the Act means the following: <Amended on Dec. 15, 2015; Jun. 19, 2018; Oct. 29, 2019; Apr. 13, 2022>

1. Deleted; <Oct. 29, 2019>

2. An employer shall select a retirement pension trustee in comprehensive consideration of the capability and expertise in the overall aspects of a retirement pension plan, such as performing operational management services and asset management services, providing related services, etc. In such cases, where an employer of a business employing at least 300 persons at all times reports retirement pension rules under Articles 13 and 19 of the Act, or selects or changes a retirement pension trustee, he or she shall submit a written statement of grounds for the selection or change of the retirement pension trustee to the Minister of Employment and Labor;

3. An employer shall provide the Korea Workers' Compensation and Welfare Service or a retirement pension trustee (referring to an executive secretary if a contract for operational management services has been concluded with multiple retirement pension trustees under Article 4 (6)) with data, such as collective agreements, employment rules, labor contracts, and payroll records, as necessary for calculating contributions and for verifying whether the employer has secured the ability to pay benefits under Article 16 of the Act; in such cases, data necessary for verifying whether the employer has secured the ability to pay benefits under Article 16 of the Act shall be provided within three months after the end of each business year;

4. Where an employer entrusts a retirement pension trustee or specialized institution with collective training under the latter part of Article 32 (2) of the Act, he or she shall cooperate to conduct the training;

5. When an employer selects or changes an executive secretary, he or she shall inform the retirement pension trustee who performs the operational management services of such fact within seven days from the date of selection or change.

Article 32(Content of Training for Retirement Pension Holders) #

(1) "Matters prescribed by Presidential Decree, such as the operating status of the retirement pension plan of the business concerned" in the former part of Article 32 (2) of the Act means the following: <Amended on Apr. 13, 2022>

1. Each of the following matters regarding the plan in general:

(a) Characteristics and differences of each plan, such as matters regarding types of benefits, eligibility requirements, amount of benefits, etc.;

(b) Matters concerning the operation of a retirement pension plan of the relevant business, such as secured loan, early withdrawal, interest on delayed payment, etc.;

(c) Matters concerning wages, etc. being the criteria for the calculation of benefits or contributions;

(d) Matters concerning procedures for paying benefits and transfer of reserves to an individual retirement pension account, etc. at the time of retirement;

(e) Matters concerning taxation system, such as pension income tax, retirement income tax, etc.;

(f) Where the retirement pension plan of the relevant business is suspended or abolished, methods of handling such situation;

(g) Matters concerning the general principle of managing asset and liabilities in consideration of income, asset, liabilities, age, number of years of consecutive service, etc. of participants, and the importance of planning for old age;

2. The following matters where a defined benefit plan is established:

(a) Current status of contributions paid over the recent three years;

(b) Standard amount of benefits by type of benefits;

(c) Current status of reserves compared with minimum reserves as at the end of the immediately preceding business year;

(d) Where a financial stabilization plan is prepared, the plan and the progress of implementation;

(e) Matters concerning the current status of operation, operational object, etc. of reserves;

3. The following matters where a defined contribution plan is established:

(a) Amount of an employer's contributions, timing of payment, and current status of payment;

Article 32-2(Methods of Training Participants of Defined Benefit Plans) #

Methods of training participants under the former part of Article 32 (2) of the Act shall be as follows:

1. Common training under Article 32 (1) 1: Posting training materials at places accessible by participants, such as the intranet or the relevant place of business, at all times: Provided, That the first training after a retirement pension plan is adopted shall be conducted by any of the following methods:

(a) Sending training materials in writing or by e-mail, etc.;

(b) Collective training, such as training, meetings, and lectures;

(c) On-line training through information and communications networks;

2. Training for participants of a defined benefit plan under Article 32 (1) 2: Posting training materials at places accessible by participants, such as the intranet or the relevant place of business, at all times or methods specified in any item of subparagraph 1;

3. Training for participants of a defined contribution plan under Article 32 (1) 3: Methods specified in any item of subparagraph 1.

[This Article Newly Inserted on Apr. 13, 2022]

Article 32-3(Requirements for Specialized Institutions) #

"Specialized institution satisfying the requirements prescribed by Presidential Decree" in the latter part of Article 32 (2) of the Act means an institution meeting all of the following requirements:

1. It shall have at least one instructor prescribed by Ordinance of the Ministry of Employment and Labor who has expertise in retirement pension plans;

2. It shall satisfy the requirements prescribed by the Ordinance of the Ministry of Employment and Labor, such as training materials and other training facilities to provide training under Article 32-2.

[This Article Newly Inserted on Apr. 13, 2022]

Article 33(Prohibited Acts for Employers) #

"Act prescribed by Presidential Decree" in Article 32 (4) 2 of the Act means the following: <Amended on Oct. 29, 2019; Apr. 13, 2022>

1. Deliberately omitting the following data (including where no data are provided) necessary to perform operational management services or asset management services or providing false data to a retirement pension trustee:

(a) Data, such as collective agreements, employment rules, labor contracts, and payroll records, as necessary for calculating contributions and for verifying whether the employer has secured the ability to pay benefits under Article 16 of the Act;

(b) Other data necessary for performing operational management services, such as payment of benefits, and asset management services;

2. Requesting a retirement pension trustee to provide services with economic value in addition to the supplementary services specified in the terms and conditions, etc., or receiving such services from such trustee;

3. Requesting a retirement pension trustee to purchase goods, etc., or selling him or her goods, etc. on the ground for having concluded a contract;

4. Requesting a retirement pension trustee to present a definite amount of returns on a management method that does not present fixed returns, or receiving such proceeds from such trustee;

5. Failing to prepare or notify a financial stabilization plan.

Article 34(Prohibited Acts for Retirement Pension Trustees) #

(1) "Act prescribed by Presidential Decree" in Article 33 (3) 4 of the Act means the following: <Amended on Oct. 29, 2019; Jul. 11, 2022>

1. Using the information he or she acquired in the course of performing duties, such as operational instructions, etc. given by employers or participants, for his or her or a third party's interest;

2. Requesting employers, participants, or persons interested therewith to conclude a retirement pension agreement on the condition of giving financial advantage to them, such as extending existing loans, granting new loans, etc.;

3. Compelling employers or participants to adopt a certain management method;

4. Providing employers or participants with a definite judgment or judgment without reasonable grounds, with regard to a rise or fall in the value of a particular management method;

5. Suggesting a remarkably favorable condition deviating from the ordinary conditions in the methods of operating reserves, etc.;

6. Applying to an employer or participant, different interest rates, etc. on operating methods for which the payment of principal and interest is guaranteed, without any reasonable grounds;

7. Presenting to employers or participants a definite amount of returns on a management method that does not present fixed returns;

8. The following activities related to the operation of reserves in default option schemes:

(a) Obtaining approval of default option schemes by fraud or other improper means;

(b) Discriminating participants by giving preferential treatments to specific participants in a way which results in a significant difference in the rates of returns, etc.;

(c) Providing information under Article 21-3 (1) of the Act or giving notice under Article 13-3 (1) or 13-4 (2) of this Decree by fraud or other improper means.

(2) Detailed standards for each subparagraph of paragraph (1) shall be determined and publicly notified by the Financial Services Commission after consultation with the Minister of Employment and Labor.

Article 35(Concrete Meaning of Extraordinary Benefits) #

(1) "Any extraordinary benefit prescribed by Presidential Decree" in Article 33 (4) 2 of the Act means the following:

1. Offering money or valuables to induce a contract or to maintain a contract;

2. Discounting fees not based on terms and conditions;

3. Paying all or some of the expenses to be borne by an employer or participant;

4. Paying interest on loans a participant or employer obtained from a relevant retirement pension trustee, on behalf of such participant or employer;

5. Providing supplementary services with economic value not based on terms and conditions;

6. Other economic benefit corresponding to those under subparagraphs 1 through 5, which is determined and publicly notified by the Financial Services Commission.

(2) The concrete standards for the benefit under each subparagraph of paragraph (1) shall be determined and publicly notified by the Financial Services Commission after consultation with the Minister of Employment and Labor.

Article 36(Content of Training for Individual Retirement Pension Holders) #

(1) "Matters prescribed by Presidential Decree, such as the operating status of the retirement pension plan of the business concerned" in Article 33 (5) of the Act means the following: <Amended on Apr. 13, 2022>

1. In cases of an individual retirement pension plan under Article 24 (2) of the Act: Matters under Articles 17-2, 18, 32 (1) 1 (e) and (g), and subparagraph 3 (c) and (d) of that paragraph of this Decree;

2. In cases of an individual retirement pension plan under Article 25 of the Act: Matters concerning Article 32 (1) 1 and 3 of this Decree.

(2) Training under paragraph (1) shall be conducted by means prescribed in any item of subparagraph 1 of Article 32-2. <Amended on Apr. 13, 2022>

Article 36-2(Evaluation of Retirement Pension Trustees) #

The Minister of Employment and Labor shall evaluate retirement pension trustees under Article 34 (2) 2 of the Act every year.

[This Article Newly Inserted on Apr. 13, 2022]

Article 37(Supervision of Retirement Pension Trustees by Financial Services Commission) #

(1) "Services prescribed by Presidential Decree" in the provisions, with the exception of the subparagraphs, of Article 36 (3) of the Act means operational management services and asset management services.

(2) The Financial Services Commission may determine and publicly notify detailed standards necessary to conduct supervision of the duties under paragraph (1). In such cases, it shall have a prior consultation with the Minister of Employment and Labor.

Article 38(Measures to Be Taken by Employers Following Abolition of Plans) #

"Measures prescribed by Presidential Decree" in Article 38 (2) of the Act means the following: <Amended on Oct. 29, 2019>

1. Employers shall submit a report of abolition containing the following to the Minister of Employment and Labor within one month from the date a retirement pension plan is abolished:

(a) Consent of the employees' representative to the abolition of the retirement pension plan under Article 4 (3) of the Act;

(b) Grounds for abolition of the retirement pension plan and date of abolition;

(c) Reserves and unpaid contributions of the relevant business calculated on the basis of the date the retirement pension plan is abolished (referring to the shortage in reserves based on the amount under Article 16 (1) 2 of the Act, in the case of a defined benefit plan; and referring to the amount including delayed interest following delay in payment of contributions, in the case of a defined contribution plan);

(d) Measures to settle unpaid contributions such as scheduled date for payment of unpaid contributions (limited to a defined contribution plan);

2. Employers shall notify participants of the following:

(a) Matters under subparagraph 1 (c);

(b) Benefit statements and payment procedures;

(c) Period subject to interim settlement under Article 40;

(d) Measures to settle unpaid contributions such as scheduled date for payment of unpaid contributions (limited to a defined contribution plan);

3. Employers shall pay unpaid contributions within 14 days from the date a retirement pension plan is abolished and shall require a retirement pension trustee to pay benefits.

Article 39(Basic Duties to Be Maintained when Retirement Pension Plan Is Suspended) #

"Basic duties prescribed by Presidential Decree" in Article 38 (3) of the Act means the following:

1. The following duties in the case of an employer:

(a) Announcing public notice to employees about the measures to handle the suspension period of a retirement pension plan, such as grounds for suspension of the retirement pension plan, date of suspension, schedule for resumption, plan to pay, if any, unpaid contributions, etc.;

(b) Providing training to participants under the former part of Article 32 (2) of the Act;

(c) Measures necessary to perform the services prescribed by statutes or regulations, etc. with regard to claims for payment of benefits, management of reserves, etc. while a retirement pension plan is suspended;

(d) Other duties determined by the Minister of Employment and Labor for maintaining the continuity of retirement pension plans and for protecting participants;

2. The following duties in the case of a retirement pension trustee:

(a) Paying benefits following retirement, etc. of participants;

(b) Providing training of participants entrusted pursuant to the latter part of Article 32 (2) of the Act;

(c) Duties specified by statutes or regulations and a contract for operational management services and asset management services with regard to the payment of benefits, management of reserves, notification of current status of management, etc.;

(d) Other duties determined by the Minister of Employment and Labor for maintaining the continuity of retirement pension plans and for protecting participants.

Article 40(Period Subject to Interim Settlement Following Abolition of Retirement Pension Plans) #

The amount of interim settlement (applicable only to a defined benefit plan) where benefits are deemed paid by interim settlement pursuant to Article 38 (4) and (5) of the Act, and the period subject to interim settlement shall be as follows:

1. In cases of a defined benefit plan: The amount of interim settlement shall be calculated by dividing proportionally the amount of reserves accumulated for each business in consideration of the period of consecutive service and average wage of each participant, and the amount of benefit under subparagraph 4 of Article 13 of the Act of each participant; and the period subject to interim settlement shall be counted on the basis of the amount of interim settlement;

2. In cases of a defined contribution plan and an individual retirement pension plan under Article 25 (1) of the Act: The period subject to interim settlement shall be counted starting from the date each participant joins a retirement pension plan to the last day of the period corresponding to the contributions paid by an employer.

Article 41(Entrustment and Delegation of Authorities) #

(1) The Minister of Employment and Labor shall entrust the following authorities to the Financial Services Commission pursuant to Article 42 (1) of the Act:

1. Registering retirement pension trustees pursuant to Article 26 of the Act;

2. Revoking the registration of retirement pension trustees or issuing orders to transfer services pursuant to Article 27 of the Act;

3. Revoking the registration of retirement pension plan solicitors or suspending their services pursuant to Article 31 (6) of the Act;

4. Issuing corrective orders or orders to transfer services pursuant to Article 36 (1) and (2) of the Act (including requests to make a report or to submit documents pursuant to Article 40 of the Act, to the extent necessary to exercise the relevant authorities);

5. Holding hearings under Article 41 of the Act;

6. Imposing and collecting administrative fines under Article 48 of the Act (limited to imposing and collecting administrative fines on retirement pension trustees).

(2) The Financial Services Commission may determine and publicly notify detailed standards necessary to perform the duties under paragraph (1) 1 through 4. In such cases, it shall have a prior consultation with the Minister of Employment and Labor.

(3) Where the Financial Services Commission revokes the registration of a retirement pension plan solicitor or suspends his or her services pursuant to paragraph (1) 3, it shall notify the Minister of Employment and Labor of the content thereof and the grounds therefor.

(4) The Minister of Employment and Labor shall entrust the following authorities to the Governor of the Financial Supervisory Service pursuant to Article 42 (1) of the Act:

1. Approval for the standard contract under subparagraph 2 of Article 23 of the Act;

2. Verification of any violation of matters to be observed by retirement pension plan solicitors pursuant to Article 31 (7) of the Act.

(5) Where a retirement pension plan solicitor is found to have violated any matters to be observed, as a result of verification under paragraph (4) 2, the Governor of the Financial Supervisory Service shall notify the Financial Services Commission of such finding.

(6) Where deemed necessary to protect employers and participants and to maintain sound trading practices, the Minister of Employment and Labor may request the Governor of the Financial Supervisory Service to verify the matters under paragraph (4) 2, and the Governor of the Financial Supervisory Service shall conduct verification as requested and submit a written result of verification to the Minister of Employment and Labor.

Article 42(Criteria for Imposition of Administrative Fines) #

The criteria for imposition of administrative fines under Article 48 (1) and (2) of the Act shall be as listed in attached Table 3.

Article 43(Management of Personally Identifiable Information) #

If inevitable to conduct following duties, the Minister of Employment and Labor (including persons entrusted or delegated with the authorities of the Minister of Employment and Labor pursuant to Article 41), employers, retirement pension trustees, the Korea Workers' Compensation and Welfare Service, persons entrusted by the Korea Workers' Compensation and Welfare Service with the affairs of the SME retirement pension fund plan pursuant to Article 23-6 (3) of the Act, persons entrusted with operational management services pursuant to Article 28 (2) of the Act by a retirement pension trustee, agencies entrusted with the duties of registering retirement pension solicitors pursuant to the latter part of Article 31 (2) of the Act, and agencies entrusted with the duties of conducting training under the latter part of Article 32 (2) of the Act may manage data including resident registration numbers under subparagraph 1 of Article 19 of the Enforcement Decree of the Personal Information Protection Act or foreigner registration numbers under subparagraph 4 of that Article: <Amended on Nov. 3, 2020; Apr. 13, 2022>

1. Duties concerning notification of the current status of operation under Article 18 of the Act (including cases applied mutatis mutandis in Article 23-11 of the Act);

2. Duties concerning entering into contracts to establish the SME retirement pension fund plan under Article 23-6 (1) of the Act;

3. Duties concerning establishing the participant contribution account of fund plan under Article 23-8 of the Act;

4. Duties concerning the State's support and recovery of subsidies under Article 23-14 of the Act;

5. Duties concerning providing guidance and supervision, etc. to the Korea Workers' Compensation and Welfare Service under Article 23-16 of the Act;

6. Duties concerning registering retirement pension trustees pursuant to Article 26 of the Act;

7. Duties concerning revoking registration of retirement pension trustees and issuing orders to retirement pension trustees to transfer services pursuant to Article 27 of the Act;

8. Duties concerning concluding an operational management services contract pursuant to Article 28 of the Act;

9. Duties concerning concluding an asset management services contract pursuant to Article 29 of the Act;

10. Duties concerning performing operational management services pursuant to Article 30 of the Act;

Article 44(Re-Examination of Regulation) #

The Minister of Employment and Labor shall examine the appropriateness of the following matters every three years, counting from each base date specified in the following (referring to the period that ends on the day before the base date of every third year) and shall take measures, such as making improvements: <Amended on Dec. 30, 2016>

1. The minimum levels of reserves against defined benefit plans under Article 5: January 1, 2017;

2. Deleted; <Dec. 30, 2016>

3. Criteria for deciding the deficiency in reserves and plans to cover the deficiency under Article 7: January 1, 2017;

4. Requirements for retirement pension plan solicitors under Article 28: January 1, 2017;

5. Matters to be observed by retirement pension plan solicitors under Article 30: January 1, 2017.

[This Article Newly Inserted on Dec. 9, 2014]