Call for grace period on 52-hour maximum working week

The Korea Federation of Small and Medium-Sized Businesses asked the National Assembly to give at least one-year grace period before the implementation of the 52-hour maximum working week for workplaces with 50 to 299 employees scheduled for January 1, 2020. The 52-hour ceiling has been in effect for workplaces with 300 or more employees since July last year and will be applied to those with five to 49 workers from July next year. Small- and medium-business entrepreneurs have requested at every opportunity that the government postpone the implementation of the 52-hour weekly ceiling. However, they are pinning their hope on the National Assembly, as the Employment and Labor minister recently reaffirmed the January implementation.

The current internal and external economic situations are far more unfavorable than when President Moon Jae-in promised to reduce the weekly maximum work hours to 52 as part of his presidential campaign pledges. Many small- and mid-sized businesspeople claim that they are facing desperate situations due to the prolonged economic slump and rising manpower costs. In a survey conducted by the Korea Federation of Small and Medium-Sized Businesses in May last year, 31.2 percent of businesses cited production disrupted by falling operating rates and difficulties in meeting supply deadlines as their biggest grievances in the event of the 52-hour workweek comes into effect. The reduced maximum work hour system requires companies to hire more workers. However, numerous companies cannot normally operate without migrant workers. They complain that due to the extreme difficulties in hiring new employees, they have no choice but to reduce production.

After visiting small- and mid-sized companies at the Namdong Industrial Complex in Incheon just before the Chuseok holidays, Deputy Prime Minister and Economy and Finance Minister Hong Nam-ki wrote on his social media page that he would review the direction of the government’s response to the planned implementation of the 52-hour maximum working week for businesses with 299 or less employee. He suggested that he found the situation not easy during the on-site visits. In August, the floor leader and other lawmakers of the ruling Democratic Party introduced a bill calling for postponing the implementation of the 52-hour system.

No one would deny that Korea needs to shake off the bad name of the country with the world’s longest-working hours and let employees go home earlier to enjoy their dinner with their families. However, good intentions do not guarantee good results, as was seen in the case of the drastic rises in minimum wages over the past two years. As small- and mid-sized businesspeople are not entirely opposing the 52-hour system but request more time before its implementation, we expect policymakers to take it into full consideration.