May 17th, 2018
On May 17th, 2018, the government held a policy coordination meeting, presided over by Prime Minister Lee Nak-yeon, and came up with measures to support a soft landing of shorter working hours in workplaces.
The government expects that the amendment to the Labor Standards Act to reduce working hours which was promulgated on March 20th, 2018 will enhance workers' quality of life and boost job creation and eventually lead to national competitiveness.
To respond to the short-term difficulties which might occur in the process of reducing working hours, such as cost increase for SMEs and wage decrease for workers, the government created the cross-ministerial support measures after having held a series of meetings among relevant government agencies and gathered opinions from experts since March this year.
The measures focus, among others, on easing the burden on SMEs and encouraging prompt reduction of working hours. They also include measures to ensure that working time reduction leads to job creation and specialized measures designed to respond to the needs of different major industries.
The main features of the measures are as follows: i) support for new hiring and wage preservation will be strengthened; ii) preferential support will be provided to companies which reduce working hours promptly; iii) support will be provided in improving productivity and ways of working; iv) manpower support will be enhanced to ease labor shortages; and v) specialized measures will be carried out to support and manage the industries no longer granted exemption.
The government will also take follow-up actions to ensure effective implementation of the measures.
Task Forces for Working Time Reduction will be set up at each of the 47 local Labor Offices nationwide to monitor the preparation status of workplaces and provide information on support measures and consulting services.
In addition, a government-wide implementation system will be established in cooperation with relevant Ministries to closely monitor until shorter working hours take hold across workplaces. For each major industry, competent Ministries will create a support team to conduct continuous workplace monitoring.
If working hours are effectively reduced through all these efforts, as many as 1.03 million workers who currently work over 52 hours a week would see their average weekly working hours fall by at least 6.9 hours, which in turn would create 140,000-180,000 jobs.
Moreover, if the 52-hour limit on weekly working hours takes hold across workplaces, it is expected to have positive effects on reducing industrial accidents and improving labor productivity. For every 1% decrease in working hours, the industrial accident rate is expected to drop by 3.7%, and for every 1% decrease in weekly working hours, labor productivity to grow by 0.79%.
Employment and Labor Minister Kim Young-joo said, “Many concerns were voiced when the five-day work-week was introduced in 2004, but we successfully landed it softly across industries.”
She added, “Improving the practice of working long hours is expected to guarantee a healthy and leisurely life for the future as well as the present generations, change the fundamentals of our economy, and also lead to creation of jobs for young people.” She said, “Based on consensus between labor and management, the government will continue to make its utmost efforts until the maximum weekly working hours of 52 takes root across workplaces.”