SOUTH KOREA Trends and Developments Contributed by: Sang Hoon Lee and William Kim, Lee & Ko
Practical implications for businesses The Yellow Envelope Law, if enacted, will fun - damentally alter Korea’s labour relations land - scape. Companies operating in Korea should consider the following steps. • Review worker classifications: Assess rela - tionships with contractors and self-employed individuals to ensure compliance with the expanded definition of “employee”. Maintain clear documentation to rebut presumptions of employee status. • Restructure subcontracting arrangements: Principal contractors should minimise direct oversight of subcontractor employees and establish functional separations to avoid employer liability. • Strengthen compliance programmes: Develop robust policies to address the broader scope of labour disputes, particularly those related to existing agreements and unfair labour practices. • Document industrial actions: Maintain detailed records of union activities and individual participation to support potential damage claims while ensuring responses to industrial actions align with legal require - ments.
Conclusion The proposed amendments to the TULRAA, dubbed the Yellow Envelope Law, signal a transformative shift in Korea’s employment law framework. By expanding the definitions of “employee” and ”employer,” broadening the scope of labour disputes, and limiting union liability, these changes will significantly impact workplace dynamics. For businesses, proactive preparation is essential to mitigate risks and ensure compliance in this evolving legal land - scape. As discussions in the National Assembly intensify, staying informed and agile will be cru - cial to navigating South Korea’s dynamic labour market successfully.
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