An escrow service introduced by the Seoul Metropolitan Government to protect freelancers from nonpayment after completing work is approaching 1,000 cumulative contracts. With use growing rapidly, the city expects the service to ease concerns about unpaid fees and support stable income for freelance workers.
The escrow service on Seoul Freelancer On, the city's comprehensive support platform for freelancers, had recorded 994 cumulative contracts worth 811 million won ($580,000) as of the 6th of this month, the city said on the 15th. Cumulative contract value jumped more than sevenfold from 114 million won at the end of last year. Platform membership also rose about 2.6-fold over the same period, to 3,085 from 1,183.
Under the service, clients deposit contract payments in advance with a partner financial institution, and the money is released to the freelancer once the work is completed. The city launched the service on a trial basis in April last year, the first public institution in the country to do so, to prevent losses from nonpayment or delayed payment.
In late January this year, the city unveiled Seoul Freelancer On, a comprehensive support platform that adds career management, expert counseling and job listings to the escrow service. Freelancers can obtain certificates of completed work to document their career history, and receive free expert counseling on contract reviews, unpaid fees, labor issues, taxes and copyright. They can also check job listings from public institutions and register profiles highlighting their experience and areas of expertise.
The city offers financial incentives to encourage clients to use the service. Companies and business owners that meet eligibility requirements can receive preferential terms, including a credit guarantee ratio raised to 90% from 85% and a guarantee fee rate lowered to 1.0% a year from 1.2%. The program is also linked to long-term, low-interest policy loans of up to 800 million won per company and additional points when applying for Hi Seoul Brand certification.
Seoul is also expanding support to reduce income gaps caused by childbirth and illness. Spousal childbirth leave benefits for male freelancers were extended this year to a maximum of 15 days from 10, with payments of up to 1.2 million won. Female freelancers who give birth receive a total of 2.4 million won, combining the central government's 1.5 million won childbirth benefit with 900,000 won from the city. Those unable to work because of illness or injury can receive 96,960 won a day for up to 14 days, or up to 1,357,440 won a year, through the city's hospitalization living expense support program.
To mark the platform's 3,000th member, the city will run a promotional event from the 19th of this month through Nov. 20 for new sign-ups and escrow service users. A total of 354 participants will be selected to receive Seoul Love Gift Certificates and beverage vouchers, among other prizes. Details are available on the Seoul Freelancer On website.
"We will improve the platform's ease of use and expand its support functions so that freelancers can work with stability and receive fair recognition for their work and their careers," said Park Kyung-hwan, director general of the Seoul Metropolitan Government's Bureau of Labor and Public Welfare.