Mr. Kim, chairman of a retailer (Company A), has a recent cause for concern. Not long after one of his employees, Mr. Park, an assistant manager, asked for childcare leave, Mr. Jung, a manager, is now asking for his working hours to be reduced for childcare. Mr. Kim does not quite understand why male workers should take childcare leave, though he was told that childcare leave should be broadly used for the female workforce. Mr. Kim is also worried about this trend as he is planning to expand the business into ladies’ apparel.
The slogan “Two kids are enough, and raise them well, whether they are sons or daughters”, proposed in the 70s is now being emphasized again. The government is trying to lessen the burden of female employees (caused by childcare), through policies generally known as ‘Protection of Maternity,’ which include childcare leave and reduction of working hours during child-rearing. The fact that many female employees are reluctant to have children because of the resulting burdens on their career has been pointed out as the main factor for the low birthrate.
Business acknowledges that the issue of a low birthrate is something to be tackled since a low birthrate can cause labor shortages. Nevertheless, most of the policies that the government proposes are quite burdensome for companies.
Mr. Kim will probably perceive the absence of Mr. Jung and Mr. Park as a heavy burden on his company since he is planning to expand his business. Companies can prepare for maternity leave for their female employees since pregnancy can easily be observed. However, if a male employee abruptly applies for childcare leave as the policy also allows husbands to apply for leave days, companies face a complex situation. Therefore, CEOs, as well as employees planning to raise children, need to understand the policy for maternity protection to help them deal with childcare issues at the workplace.
Childcare leave and related issues
Any employee with a child of 6 years or less is eligible for childcare leave of up to a year to raise their children. Nonetheless, if an employee has worked for less than one year, or the spouse of the worker has already applied for childcare leave, the worker’s application is likely to be declined. It is possible for a married couple to apply for leave days in turn, but not at the same time.
Employers will be fined a maximum of 5 million KRW (approx. 4,596 USD) if they do not give leave to employees for any other reasons than the two described above. However, employers are allowed to consider this leave as unpaid. Employees are paid 40% of the ordinary wage within a range of 500,000 ~ 1 million KRW (approx. 459 ~ 919 USD) per month by the government.
Some employees voluntarily return to work before the childcare leave period ends. However, it is assumed that most companies bring in substitute workers to work until the childcare leave end date agreed upon by the employee and the company. In consideration of this, returning to work earlier is only permitted when companies agree.
Working hour reductions during child-rearing period
Instead of leave days, employees eligible for childcare leave can apply for a reduction of between 15 and 30 working hours per week. The maximum duration for this reduction is one year. Like childcare leave, employers can decline an application if the applicant has worked for less than one year or the applicant’s spouse is already on such leave.
Employers also can decline an application if they requested substitute workers from a Ministry of Employment & Labor Job Center and made an effort to hire workers for at least 14 days but were unsuccessful.
Employers can also decline an application for duties which do not have fixed schedules, such as aircraft operation or surgery, or if employers can prove that accepting the application would cause major harm to the business. If employers decline applications for any other reasons, they will be fined a maximum of 5 million KRW (approx. 4,596 USD).
There are two types of working hour reduction for child-rearing periods: ‘reduction of working hours’ which allows the recipient to work mornings only and ‘reduction of working days’ which allows the recipient to work 3 days a week. If the Rules of Employment or the collective agreement state specific regulations for reduced working hours (such as 4 working hours per day), then the recipient shall follow those regulations. If a company does not have such regulations, it can only request that an employee change his/her choice of the two types of reduction, but the ultimate decision lies with the employee.
Is it impossible for an employee with reduced working hours to work overtime? Sometimes overtime is inevitable. If an employee with reduced working hours is willing to work overtime, he or she is allowed to work maximum 12 hours overtime per week. Nonetheless, companies cannot force employees to work overtime. Companies should understand that they will be fined a maximum of 10 million KRW (approx. 9,192 USD) if they do. To prevent any legal problems, companies are advised to obtain applications to work overtime from the employee working reduced hours.
Government assistance regarding childcare leave, etc.
To promote childcare leave and reduction of working hours during child-rearing period, companies introducing the childcare benefit system can receive a monthly subsidy of 200,000 KRW (approx. 183 USD) per childcare benefit recipient. Aside from the subsidy, SMEs are provided with 400,000 KRW (approx. 367 USD) per substitute worker, while large enterprises are entitled to 200,000 KRW per substitute worker when they are hired to fill positions of those on childcare leave.
If companies are to hire substitute workers, it is not necessary for those substitute workers to carry out the exact same tasks handled by those they are replacing. In the example situation above, hiring a substitute worker to take on duties of existing employees while they handle the duties of Mr. Park and Mr. Jung is also acceptable, and the subsidy can still be received.
Companies need a system to deal with childbirth and child-rearing
As the low birthrate and the aging society become a serious social problem, companies must allow for and obey an increasing number of regulations supporting childbirth and child-rearing. In this regard, companies should prepare systems that allow them to respond to childcare issues, improve organizational culture, and support employee multitasking. Companies are also advised to find ways to use maternity protection systems in a way that promotes productivity and employee morale.