Ruling party introduces chip cluster bill as union opposes labor exemptions

The ruling Democratic Party of Korea (DPK) introduced a bill Tuesday to support a major semiconductor cluster in Korea’s southwestern region, drawing opposition from labor rights groups over provisions that would ease working-hour limits and labor protections.

The bill, tentatively called the Special Act on Super-Regional Economic Zones, would allow local governments to form a single economic zone and offer faster permitting along with financial, fiscal and tax incentives to businesses.

This comes as the liberal administration under President Lee Jae Myung and businesses seek to develop an 800 trillion won semiconductor cluster in the southwestern Jeolla region.

DPK floor leader Rep. Han Byung-do said the party would submit another version of the bill — one that does not contain controversial labor exemptions — and develop a final draft through parliamentary deliberations.

“We are well aware of the differing views across society on the bill’s key contentious issues, including the proposed working-hour exemptions,” Han said during a meeting at the National Assembly. “We will not set a deadline, but will allow sufficient deliberation and debate. We will listen broadly to different voices and develop a final version through joint consideration of the bills.”

One of the most contentious provisions under discussion is a “white-collar exemption” that would allow certain high-income research and development employees to negotiate their working hours with their employers. It would cover workers developing new products or technologies whose employment income falls within the top 3 percent.

Under a written agreement, employers and eligible employees could set working hours, rest breaks and days off, including arrangements for overtime, night and holiday work, outside the legal restrictions under the Labor Standards Act. The exemption would therefore extend beyond the 52-hour weekly working limit.

Other provisions under discussion include easing restrictions on the use of dispatched workers in manufacturing within the zones and extending the permitted period of fixed-term employment from two years to four.

Labor groups say they oppose the exemptions, warning that these could pave the way for a broader erosion of labor protections.

The Korean Confederation of Trade Unions, a powerful labor umbrella organization with more than 1 million members, immediately condemned the legislative plan, saying that it would oppose any efforts to weaken the rights of workers in the name of labor reform or economic development.

“The bill contains not only provisions that roll back key labor protections, but also harmful measures that would undermine public education and health care, damage the environment, worsen the climate crisis and infringe on local residents’ right to decent living conditions,” the group said in a statement. “We cannot accept the argument that promoting industry and competitiveness requires curtailing the rights of workers and citizens and worsening their living conditions.”

The Ministry of Employment and Labor said talks involving labor, management and relevant ministries were underway, with no predetermined deadline. It pledged to seek a balanced approach that would strengthen the competitiveness of industries such as semiconductors and artificial intelligence, while fostering a healthy and sustainable working environment.