"Boss, please give me my severance pay. If not, we will report you."
A, who operates a manufacturing plant in Ansan, Gyeonggi Province, hired B, an undocumented worker, seven years ago under the condition of not paying severance pay. Although B agreed to the contract terms, as time passed, he demanded severance pay. A, burdened by the severance pay amounting to tens of millions of won, requested, "Give me some time," but B pressured him, stating he would report the hiring of an undocumented worker.
As hiring undocumented workers becomes frequent in small and medium-sized enterprises in the outskirts of the metropolitan area or in rural areas, conflicts between undocumented workers and employers are also emerging. A typical issue is severance pay. According to the Labor Standards Act, even if a worker is in an undocumented status, they can receive severance pay if they have worked more than 15 hours a week for over one year.
Generally, the wages of undocumented workers are lower than those of legal workers; however, some corporations are said to offer slightly higher salaries instead of providing severance pay. There are cases where undocumented workers, after agreeing to these terms and starting work, later raise issues.
A director of a foreign labor center noted, "The undocumented worker community is very well established, and these days, there are many brokers offering legal services for a fee," adding, "When they suddenly leave and demand severance pay, it is not easy to come up with a large sum of money, leading to conflicts."
Employers argue that the penalties for hiring undocumented workers are not equitable. They claim that employers face disadvantages for hiring undocumented workers and for failing to pay severance, while undocumented workers receive virtually no penalties.
According to the Immigration Control Act, those who hire undocumented workers can face up to three years in prison or a fine of up to 20 million won. Additionally, they are restricted from legally hiring foreign workers for three years, and if the hiring of undocumented workers is detected, the employment of legal foreign workers is also canceled. Factories with many foreign workers are essentially facing closure.
In contrast, undocumented workers face no consequences until they leave the company and are captured by the Ministry of Justice or police. Some undocumented workers exploit this by threatening employers to demand higher wages or severance pay that is not included in their contracts.
Conversely, there are cases where employers report undocumented workers to avoid paying severance. Arrested undocumented workers are moved to protective facilities and face deportation measures, making it virtually impossible to receive severance pay.
A representative of an immigrant organization said, "Situations where undocumented workers and employers frequently report each other over severance pay issues are occurring. There is a need for fundamental solutions, such as expanding support for hiring foreign workers, to prevent corporations from employing undocumented workers."
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