□ Minister of Employment and Labor An, Kyung-duk stated that starting from next year, the ‘Work Hours
Reduction including Family Care System’ will be expanded to all firms with at least one employee.
ㅇ The work hours reduction system institutionally guarantees the right of employees to apply to
their employer for reduced working hours for reasons including taking care of family members.
* This system was originally adopted after a revision to the Equal Employment Opportunity and Work-Family Balance Assistance Act on August 27, 2019.
- The system initially targeted companies with more than 300 employees, but will be expanded in stages
to cover companies of different sizes by 2022.
* Companies with 30 or more employees were covered by 2021, and this will be extended further
to all companies with less than 30(more than one) employees by January 2022.
□ The grounds on which employees can apply for reduced hours are
ㅇ “family care,” “taking care of one’s own health,” “preparing for retirement(for those aged over 55),
and “study.”
- When an employee meets these requirements, employers are required to grant the request.
ㅇ However, one thing to note is that employers can refuse a request for reduced working hours in cases
where alternative workers cannot be hired or it would cause severe setbacks in normal business operations.
ㅇ Employees can apply for a period of up to one year, and this can be extended once for an additional
period of up to two years.
- However, only a one-year extension is available when the reason for reduced hours is study(academic).
ㅇ Companies are not allowed to mistreat, lay off employees or make any disadvantageous changes in their
working conditions due to reduced working hours.
- Companies cannot demand overtime from an employee who has requested shorter work hours, and must
return the employees to an equivalent position or one with the same level of pay as their prior position once
the period of reduced working hours comes to an end.
□ The ministry is also providing ‘work-life balance job subsidies’ to employees to reduce
the burden of lower income and recruitment and labor costs stemming from shortened work hours.
ㅇ This assistance will provide employers with indirect labor costs and a reduced earnings allowance.
- Employees can also receive some support through their employer to offset reduced earnings.
ㅇ Following a rapid increase in requests for subsidies and in order to help the work hours reduction system become established, subsidies will be reformed from 2022 to make fiscal expenditure more efficient.
- The system will end support for large corporations, thereby providing focused support to SMEs,
which face a comparatively large labor burden.
- After the shortening of work hours, the conditions of work-hour reduction system can be unified
by adjusting work hours to more than 15 hours and less than 30 hours per week.
- By putting an end to support that covered the costs of hiring replacement workers, a system
which was not widely used, the new system will provide more substantiated support through measures
such as increasing the price of indirect labor(from 200,000 won to 300,000 won per month).