Small, mid-sized firms to get subsidies of up to KRW600,000
The South Korean government is setting aside KRW2.6 billion to support businesses that will choose to reduce employees' working hours to four and a half days a week.
The budget will be used as a subsidy to cover labour and operating costs for small and mid-sized companies starting January, The Korea Herald reported.
According to the report, an additional KRW1.7 billion was also set aside for consulting services for firms seeking to reduce working hours.
The government's new initiative will grant up to KRW600,000 per worker each quarter for organisations with fewer than 50 employees that will choose to cut working hours to 4.5 days.
These companies may also get an additional KRW800,000 for each new hire, according to The Korea Herald.
A ministry official told the news outlet that the programme aims to reduce the financial burden on employers who are reducing working hours without cutting wages.
Firms with 50 to 300 employees are eligible for subsidies for up to 100 workers, and eligibility will be reviewed by employment insurance investigators to prevent abuse, the report added.
The move is part of South Korean President Lee Jae Myung's plan to reduce the country's working hours below the average of Organisation for Economic Co-operation and Development (OECD) nations.
South Korea's annual working hours reached 1,865 in 2024, higher than the OECD average of 1,736, according to the OECD website.
