Kibo, New Preferential Guarantee for SMEs Closed on Red Days Established

Government Office Public Holiday Paid Leave Introduction Company Preferential Guarantee Program Established

[Asia Economy Reporter Kim Cheolhyun] The Korea Technology Finance Corporation (Chairman Jung Yunmo, hereinafter referred to as Kibo) announced that it has implemented preferential guarantees for small and medium-sized enterprises (SMEs) that guarantee public holidays as paid holidays under the Labor Standards Act starting from the 4th.

This preferential guarantee was established to ensure the smooth establishment of the paid holiday system for public holidays in SMEs, following the amendment of the Labor Standards Act in March 2018. The application of public holidays to the private sector began last year with companies with 300 or more employees and public institutions, and has been expanded this year to companies with 30 to 299 employees.

The target companies for the preferential guarantee include not only those that mandatorily introduced paid holiday conversion for public holidays this year, but also companies with 5 to fewer than 30 employees, for which paid holiday conversion will be mandatory from next year, that have adopted the system early and have received a confirmation certificate for paid conversion of public holidays from the relevant local employment and labor office.

Kibo supports these companies with operating funds necessary for the paid holiday conversion and applies preferential measures such as an increase in the guarantee ratio (from 85% to 90%) and a reduction in guarantee fees (by 0.3 percentage points). The Ministry of SMEs and Startups, following the joint announcement by related ministries in November last year on measures to support the establishment of public holiday application in the private sector, has prepared additional support measures to facilitate the smooth introduction of the system in SMEs, including awarding extra points when evaluating military service designated companies and when applying for overseas market support projects, in addition to Kibo’s preferential guarantees.

Kim Youngchun, Director of Kibo, said, "Although public holidays marked in red are designated as days off, small and medium-sized enterprise workers have not been guaranteed fair rest as the holiday status varied depending on the company’s circumstances," adding, "With the implementation of this preferential guarantee, we hope that the system to improve workers’ working conditions will stabilize and that SME workers will be fully guaranteed their legally prescribed right to rest without discrimination."

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