South Korea Weighs White-Collar Exemption to Speed Up Semiconductor R&D

As the U.S. and Japan ease working-hour restrictions for semiconductor R&D personnel, South Korea grapples with reaching an agreement amid conflicting views between government ministries. President Lee Jae Myung's administration plans to pass a special law for "mega-special zones" this year, with labor exemptions being a crucial matter.

The Ministry of Trade, Industry and Energy (MOTIE) and the Ministry of Employment and Labor (MOEL) disagree on how far to loosen the 52-hour workweek limit. MOTIE Minister Kim Jung-kwan advocates for a "white-collar exemption" and extending the flexible working-hours settlement period, citing the "996" culture in Chinese IT firms.

However, MOEL Minister Kim Young-hoon queries whether more hours lead to better competitiveness, asserting that creativity and innovation matter more than sheer hours worked. The MOEL has already expanded the special overtime authorization period to a year but receives few long-term applications. Business groups, including the Korea Enterprises Federation, back MOTIE, suggesting extending the overtime unit to monthly or yearly periods and granting a white-collar exemption for R&D professionals.

Labor unions oppose the moves, fearing the creation of "bad jobs" and social unrest. Multiple semiconductor-producing nations have already adopted more flexible rules for R&D workers. The U.S. exempts certain professionals from overtime pay, Japan excludes R&D employees from overtime limits, and Taiwan allows greater flexibility over three-month periods.

South Korea risks falling behind if it maintains a rigid one-week system while competitors offer more flexibility for R&D-intensive industries. Some experts, like Korea University law professor Park Ji-soon, believe it's possible to maintain an overall working hour cap while permitting more flexibility in managing those hours.