South Korea parental leave compensation budget shows low execution

South Korea’s government support program for compensating colleagues of employees on parental leave is seeing critically low budget execution rates. Data from the Ministry of Employment and Labor, released to lawmaker Lee Yong-woo, shows that as of July, only 19.1% of this year’s 20.16 billion won budget has been utilized. Last year, the execution rate was even lower at 6.6%.

The program is designed to reimburse employers who provide financial compensation to up to five colleagues who take on the additional workload of an employee on parental leave or reduced working hours. Despite the government tripling the maximum monthly support amount from 200,000 won to 600,000 won this year, the uptake remains sluggish.

Critics point to the current application process as a primary barrier. Currently, the employee taking leave must first request that the employer compensate their colleagues, and the employer must then apply for reimbursement from the government. This structure creates social pressure and awkwardness for employees seeking to use their leave. Some suggest the government should pay colleagues directly, though the Ministry of Employment and Labor maintains that payments should go through employers to encourage a corporate culture of voluntary compensation.