[South Korea] Regulation to clarify ambiguity in ‘yellow envelope law’

In South Korea, the government has announced a regulatory overhaul that will reshape how labour unions representing subcontracted employees can negotiate with parent companies, as officials move to resolve ambiguities about who counts as an employer and how bargaining will proceed, The Korea Times reports.

The move comes ahead of the implementation of the “yellow envelope law” on March 10, 2026.

On November 25, the Ministry of Employment and Labor began collecting public opinion on amendments to the enforcement ordinances of the labour law. The groundbreaking revision reportedly extends the definition of “employer” to include not only direct contract holders, but also entities with “substantive and specific control” over the working conditions of subcontracted workers.

Under it, parent companies can be compelled to negotiate with labour unions representing workers employed by their subcontractors. A significant change which, according to The Korea Times, will have a particularly big impact on major companies that operate through widespread use of subcontracted labour and layered supply chains, common in the shipbuilding and construction industries.

Under the new rules, the default is to separate bargaining units between parent company unions and subcontractor unions due to their differing interests and negotiating subjects. Such separation is important for subcontracted workers because it gives them a seat at the negotiation table and prevents their interests from being overshadowed by larger parent company unions, according to officials.

Labour Minister Kim Young-hoon said, “This amendment to the enforcement ordinances aims to fully uphold the principle of labour-management autonomy during collective bargaining and to guarantee the bargaining rights of subcontractor unions and to establish a stable framework for talks.

“By the end of this year, we will prepare guidelines regarding employer determination and the scope of labour disputes, in order to resolve uncertainty in workplaces and enable both labour and management to adequately prepare ahead of enforcement of the law next year.”

Source: The Korea Times

(Link and quote via original reporting )

In South Korea, the government has announced a regulatory overhaul that will reshape how labour unions representing subcontracted employees can negotiate with parent companies, as officials move to resolve ambiguities about who counts as an employer and how bargaining will proceed, The Korea Times reports.

The move comes ahead of the implementation of the “yellow envelope law” on March 10, 2026.

On November 25, the Ministry of Employment and Labor began collecting public opinion on amendments to the enforcement ordinances of the labour law. The groundbreaking revision reportedly extends the definition of “employer” to include not only direct contract holders, but also entities with “substantive and specific control” over the working conditions of subcontracted workers.

Under it, parent companies can be compelled to negotiate with labour unions representing workers employed by their subcontractors. A significant change which, according to The Korea Times, will have a particularly big impact on major companies that operate through widespread use of subcontracted labour and layered supply chains, common in the shipbuilding and construction industries.

Under the new rules, the default is to separate bargaining units between parent company unions and subcontractor unions due to their differing interests and negotiating subjects. Such separation is important for subcontracted workers because it gives them a seat at the negotiation table and prevents their interests from being overshadowed by larger parent company unions, according to officials.

Labour Minister Kim Young-hoon said, “This amendment to the enforcement ordinances aims to fully uphold the principle of labour-management autonomy during collective bargaining and to guarantee the bargaining rights of subcontractor unions and to establish a stable framework for talks.

“By the end of this year, we will prepare guidelines regarding employer determination and the scope of labour disputes, in order to resolve uncertainty in workplaces and enable both labour and management to adequately prepare ahead of enforcement of the law next year.”

Source: The Korea Times

(Link and quote via original reporting )