Overview

• The National Assembly’s Environment and Labor Committee approved the Yellow Envelope Bill on July 28, setting up a floor vote on August 4
• The amendment expands the legal definition of “employer” to include any entity that substantially controls working conditions and limits firms’ ability to claim damages from unions
• The European Chamber of Commerce in Korea and the American Chamber of Commerce in Korea cautioned that vague liability provisions could undermine legal certainty and deter foreign investment
• Eight major business associations and thirteen industry groups warned the bill could destabilize subcontractor-heavy sectors, force primary contractors into extensive bargaining and expose executives to criminal penalties
• Labor Minister Kim Young-hoon defended the measure as vital for aligning South Korea’s labor laws with international due diligence and supply chain norms