SEOUL, Feb. 27 (Korea Bizwire) — South Korea’s business community on Tuesday expressed concern about additional costs stemming from a looming reduction in a weekly working hours.
The move came after the National Assembly’s environment and labor committee passed a bill aimed at shortening maximum statutory working hours to 52 hours a week from the current 68 hours.
The bill is subject to approval at a plenary session in parliament.
The envisioned cut in working hours is one of President Moon Jae-in’s key election pledges to enhance the quality of life for laborers and help create jobs. Many young South Koreans are seeking to strike a balance between work and life.
Still, the Korea Federation of SMEs, which speaks for smaller firms, expressed regret over the committee’s endorsement of the bill, claiming that the bill could place extra financial burden on smaller companies — which are already understaffed and coping with weak earnings.
The Korea Economic Research Institute has estimated that businesses have to spend 12.1 trillion won (US$11.3 billion) every year to maintain current productivity after the country adopts a 52-hour maximum workweek.
The institute also said smaller firms with less than 300 employees could shoulder about 8.6 trillion won out of 12.1 trillion won of extra costs.
The bill will be applied to companies with 300 or more workers on July 1, while firms with 50 to 299 workers and those with five to 49 will be subject to the new rule starting Jan. 1, 2020 and July 1, 2021, respectively.
In 2015, South Korean workers put in an average 2,113 hours a year at work, the second highest among all member nations of the Organization for Economic Cooperation and Development and 347 hours more than the OECD average of 1,766 hours, according to data.