SMEs "Working Hours Must Be Reformed... Don't Worry About Unpaid Overtime"

15 Small and Medium Business Groups Announce Positions on Government Restructuring Plan
Focus on Flexibility "Challenges in Meeting Deadlines and Labor Shortages"

The small and medium-sized enterprise (SME) sector expressed chronic labor shortages and stated that the government's working hours reform plan should be maintained. The focus was on flexibilizing working hours to meet delivery deadlines rather than simply increasing working hours.

On the morning of the 4th, 15 SME organizations, including the Korea Federation of SMEs and the Korea Women Entrepreneurs Association, held a press conference at the Federation of SMEs in Yeouido, Seoul, to announce their position on the government's working hours reform plan.

Kim Ki-moon, chairman of the Federation of SMEs, said, "Last year, the shortage of personnel in SMEs was 605,000, and the unfilled positions despite active recruitment reached 185,000, the highest ever," adding, "Flexible working hours are essential for SMEs facing labor shortages to cope with peak season volumes or sudden orders."

He continued, "It is regrettable that misunderstandings and lack of understanding surrounding the recent working hours reform plan have led to repeated controversies," pointing out that "the maximum weekly working hours that can be used temporarily are being interpreted as if they are used every week, and the industrial sites are being distorted as places where unpaid overtime is rampant."

Regarding the extension of working hours by unit period included in the reform plan, it was explained that the maximum average weekly working hours over one year would be 52 hours if the monthly unit is selected, 50.8 hours for quarterly, 49.6 hours for semi-annual, and 48.5 hours annually, which is the same as or up to 30% less than the current standard.

They emphasized that introducing a new working hours system at workplaces requires labor-management agreement and individual worker consent. They also stated that, given that 20% of SME workers change jobs within a year, extension of working hours without consent is practically unlikely. Regarding concerns raised by labor groups about 'unpaid overtime' and 'unused annual leave,' they dismissed these as "comments made without understanding the field."

Businesspeople attending the press conference shared difficulties related to labor shortages and meeting delivery deadlines. Seok Yong-chan, chairman of the Korea Association of Innovative SMEs, said, "There is a risk of production disruption when export volumes must meet deadlines or when volumes concentrate during specific periods such as summer and winter seasons or holidays." Yoon Mi-ok, chairwoman of the Korea Women Venture Association, reported, "When joining manufacturing companies, many ask first whether there is overtime work, and if there is none, they often refuse to join, accelerating the labor shortage."

In this regard, they explained that forced labor and wage arrears are already sanctioned by law, and mechanisms are in place to apply for rights relief through complaints and lawsuits at local labor offices. They stated, "While striving to resolve labor shortages, we will actively work to foster an organizational culture where workers can use their annual leave without hesitation."

They added, "We will address concerns raised regarding this working hours reform and strengthen explanations and guidance to companies to ensure the reform's intent is realized in the field."

Finally, they said, "For the future generation and strengthening national competitiveness, we hope that the government, workers, and SMEs will unite their efforts to promptly implement the working hours reform in the original direction that benefits both labor and management."

This content was produced with the assistance of AI translation services.