South Korea – United States Department of State

President Yoon has made labor reform a key priority and has sought to increase financial transparency requirements for labor unions and ease the 52-hour workweek limit imposed by the previous Moon Jae-in administration. In December 2022, President Yoon issued the first-ever South Korean order to return to work for striking truck drivers, citing disruptions to the economy and supply chain.

According to the Korea Bureau of Statistics ( http://kostat.go.kr/portal/eng/index.action ), South Korea had about 28 million economically active people in January 2024, and an OECD employment rate of 68.7 percent. The overall unemployment rate of 3.7 percent in January 2024 is significantly lower than the 6 percent unemployment rate for youth aged 15–29. South Korea’s female labor force participation rate was 54.7 percent in January 2024. According to the OECD, Korea’s gender pay gap in 2022 was 31.2 percent, well above the OECD average of 12.1 percent. There are two main national trade union federations in the country. In 2024, the Federation of Korean Trade Unions (FKTU) had about 1.5 million members, and the Korean Confederation of Trade Unions (KCTU) had 1.2 million members. The FKTU and KCTU are affiliated with the International Trade Union Confederation.

The minimum wage is reviewed annually. Labor and Business set the minimum wage for 2024 at 9,860 KRW (about $7.50 per hour), a 2.5% increase from 2023. According to Statistics Korea, non-regular workers received about 55% of the wages of regular workers in 2023. Non-regular workers on monthly wage contracts received 1.96 million KRW per month (about $1,495), while regular workers paid monthly received 3.62 million KRW (about $2,760).

For permanent, full-time employees, the law provides unemployment insurance, national health insurance, occupational injury insurance, and participation in the national pension system through employers or employer subsidies. Non-regular employees, such as temporary and contract workers, are not guaranteed the same benefits. When it comes to severance pay for permanent employees, ROK law does not distinguish between dismissal for economic reasons. Employers’ reliance on non-regular workers is partly explained by the cost savings associated with dismissing permanent full-time employees and rehiring non-regular workers. In 2004, the ROK implemented a “guest worker” program known as the Employment Permit System (EPS) to help protect the rights of foreign workers. The EPS allows employers to legally employ a certain number of foreign workers from 16 countries, including
The Philippines, Indonesia and Vietnam, with which the Republic of Korea has concluded bilateral labor agreements.

In 2023, the annual quota for the Republic of Korea almost doubled from the previous year, to 120,000. For 2024, the quota was increased to 165,000 by expanding EPS sectors and allowing foreign workers to remain in the Republic of Korea for longer periods.

By law, unions operate autonomously from the government and employers, although national union federations consisting of various industry unions receive annual government subsidies. The ratio of organized labor to the total employed population in 2022 was 13.1 percent. The share of unions in the ROK is lower than the latest available OECD average of 17 percent. More information can be found at http://stats.oecd.org/ . Labor organizations are free to organize in export processing zones (EPZs), but foreign companies operating in EPZs are exempt from some labor laws. Exceptions include laws that mandate paid leave, require companies with more than 50 employees to hire people with disabilities to ensure at least two percent of their workforce, and limit the participation of large companies in certain business categories. Foreign companies operating in free economic zones have greater freedom to hire “non-regular” workers in a broader range of sectors for longer contract periods. ROK law provides workers with the right to free association and allows government officials and private employees to organize unions. The Trade Union and Labor Relations Adjustment Act provides for the right to collective bargaining and collective action and allows workers to exercise these rights in practice. In 2021, during the period of COVID-19-related social distancing restrictions, which included limits on the size of public gatherings, some union leaders were arrested when demonstrations exceeded these limits.

The National Labor Relations Commission is the primary government body responsible for resolving labor disputes. It offers arbitration and mediation services in response to dispute resolution requests filed by employees, employers, or both. Labor inspectors from the Ministry of Employment and Labor also have some legal authority to participate in the resolution of labor disputes. The Korea Workers’ Compensation and Welfare Service handles labor disputes resulting from industrial accidents or disasters. The Part-Time and Fixed-Term Worker Protection Act prohibits discrimination against nonregular workers and requires companies to convert nonregular workers who have been employed for more than two years to permanent employees. The two-year rule went into effect for all companies on July 1, 2009. Both the labor and business sectors have complained that the two-year conversion law has forced many companies to limit the duration of nonregular workers’ contracts to two years and incur additional costs when hiring new contract workers every two years. For more information, see the Department of State’s 2023 Human Rights Practices Report: https://www.state.gov/reports/2023-country-reports-on-human-rights-practices/South-Korea

On 26 January 2021, the Serious Accidents Punishment Act (SAPA) was passed. The Act makes CEOs personally liable for workplace accidents and occupational diseases. It also extends employee protection obligations and increases penalties for breaches. In the first conviction and sentence under SAPA, a construction company CEO received a suspended sentence of 1.5 years in prison in April 2023.