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Small biz groups urge gov't to change holiday allowance system or no 4.5-day workweek

Published: 15 Oct. 2025, 14:43 Updated: 15 Oct. 2025, 18:33

Members of the Korea Federation of Micro Enterprises hold a press conference at the federation's headquarters in Yeongdeungpo District, western Seoul on Oct. 1. [YONHAP]

Two of Korea’s largest small business groups launched a joint campaign Wednesday opposing the government’s push for a 4.5-day workweek unless the holiday allowance system is scrapped.

At a press conference outside the National Assembly, the Korea Federation of Micro Enterprises and the Korea Foodservice Industry Association warned that introducing the shorter workweek while keeping the holiday allowance — and expanding labor law coverage to businesses with fewer than five employees — would be “a death sentence for small business owners.”

The groups presented three main demands to the government and National Assembly: immediate abolition of the holiday allowance system, withdrawal of plans to apply the Labor Standards Act to businesses with fewer than five employees and guaranteed representation of small business groups in policy discussions on the 4.5-day workweek.

“If the shortened workweek is implemented while maintaining the holiday allowance and expanding labor regulations, small businesses will face double wage burdens for holiday and night shifts,” said Song Chi-young, head of the Korea Federation of Micro Enterprises. “The hourly wage-based cost structure of self-employed businesses will collapse.”

“Applying the Labor Standards Act to businesses with fewer than five employees would make labor costs unpredictable and worsen the difficulties faced by small business owners,” said Kim Woo-seok, chairman of the Korea Foodservice Industry Association.

The two organizations said they will continue joint action to address what they see as an excessive labor cost burden.

This article was originally written in Korean and translated by a bilingual reporter with the help of generative AI tools. It was then edited by a native English-speaking editor. All AI-assisted translations are reviewed and refined by our newsroom.
BY JEONG JAE-HONG [[email protected]]