Seoul: The government is moving forward with plans to legislate a 4.5-day workweek this year. The Ministry of Government Legislation announced on Wednesday that it will submit a new bill to support the reduction of working hours to the National Assembly as part of 123 legislative tasks outlined by the government.
According to Yonhap News Agency, the Ministry of Employment and Labor has allocated a budget for this initiative and plans to revise the existing law on working hours within the year. Currently, statutory working hours are capped at 40 hours per week, with companies allowed to extend this to a maximum of 52 hours by including 12 hours of overtime.
The proposed 4.5-day workweek is a transitional step towards a more ambitious goal of a 4-day workweek or 32-hour workweek, as pledged by presidential candidate Lee. This initiative aims to enhance work-life balance. However, businesses have expressed concerns that a hasty implementation could negatively impact their competitiveness.
Experts have highlighted issues with inflexible working hours, which hinder intensive work periods for research and development personnel in high-tech industries. The strict enforcement of a 52-hour workweek means that workers must stop working and leave laboratories on time, unlike their counterparts in South Korea's rival countries. Flexible working hours are deemed essential for ventures and startups, yet they are currently not permitted.
South Korea's labor productivity currently lags behind the Organization for Economic Cooperation and Development (OECD) average. An analysis by the Korea Productivity Center ranked South Korea 24th out of 37 OECD members in 2023. If the country reduces working hours without addressing these productivity issues, its industrial competitiveness could suffer.
Small and mid-size companies, in particular, may face challenges if they cannot afford to increase staffing. Complementary measures are necessary before implementing the new system.
The Korean Financial Industry Union has declared plans for a general strike on September 26 in support of the swift legislation of the 4.5-day workweek. The potential reduction in banking hours could inconvenience financial consumers, as bank employees in Korea earn an average annual salary of 120 million won ($85,775), the highest in the country. The union's strike threat, amidst consumer concerns, has drawn criticism.
The government must consider the broader societal impact of a 4.5-day workweek. A shift towards reduced working hours could undermine the diligence that has driven South Korea's economic growth, making future development more challenging. Once working hours are reduced, it would be difficult to revert them, even if negative consequences arise.
While improved working conditions are anticipated with reduced hours and unchanged pay, businesses may be reluctant to maintain the same pay for less work. Although South Korea's working hours are not short, with South Koreans working 1,901 hours annually in 2022, 149 hours above the OECD average, the focus should be on introducing flexible working hours to enhance productivity.