"Paying Fines Is Cheaper" Musinsa Cancels In-House Daycare Plan

Discussion on Reducing Benefits Such as Remote Work and Half-Day Fridays

Online fashion platform company ‘Musinsa’ has sparked controversy by completely withdrawing its plan to install an on-site daycare center at its new headquarters. It was also revealed that an executive made a remark implying that “paying fines is cheaper than operating a daycare center.”

According to industry sources on the 5th, Musinsa has completely scrapped the plan to install an in-house daycare center at its new headquarters ‘Musinsa E1,’ which is being built in Seongsu-dong, Seongdong-gu, Seoul, with four basement floors and ten above-ground floors.

Photo by Musinsa

Musinsa, which has over 1,300 employees, is subject to the mandatory installation of workplace daycare centers. Under the current Infant Care Act, businesses employing 300 or more female workers or 500 or more workers in total on a regular basis are required to install workplace daycare centers. Failure to comply results in a penalty of up to 100 million KRW.

However, on the 30th of last month, Chief Financial Officer (CFO) Choi Young-jun reportedly said during an online meeting with employees, “Welfare is something enjoyed by more than 50% of company members, but daycare centers are welfare benefits enjoyed by a lucky few,” and “We have to pay fines, but the fines are cheaper (compared to operating costs).”

Choi previously worked as a finance executive at SSG.com but left the company after two years and joined Musinsa in June. Industry analysts believe the main reason was the indefinite postponement of SSG.com’s initial public offering (IPO), which was targeted last year, amid its ongoing listing project.

Musinsa, which cited “low actual demand” as the reason for scrapping the plan, tried to manage the controversy by stating that it chose a consignment childcare method instead of an on-site daycare center. The company decided to support consignment childcare for all employees with children eligible for care and denied that the cancellation was due to the relatively low penalty fees.

Many companies are reluctant to install workplace daycare centers because the penalties for violating the installation obligation are relatively light. As of the end of last year, 27 companies had failed to comply with the mandatory installation of workplace daycare centers. Among them, four companies have been on the list for more than seven years.

Aerial view of Musinsa Campus E1, the new headquarters in Seongsu-dong, Seoul [Photo by Musinsa]

There are also complaints among employees regarding the reduction of other welfare benefits. On an anonymous office worker community, a post claiming “Our company (Musinsa) is trying to reduce benefits such as twice-weekly remote work and ‘Early Friday,’ which allows taking a half-day off on the last Friday of every month” sparked controversy.

The company explained, “We are not completely abolishing remote work. Face-to-face work will be the default, but remote work will be operated flexibly depending on the department or job,” and added, “We are currently reviewing changes to the Early Friday system.”

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