The American Chamber of Commerce in Korea (AMCHAM) noted that if the so-called yellow envelope law, which refers to amendments to articles 2 and 3 of the Labor Union Act, is implemented, it could affect the future investment intentions of American corporations in Korea.
On the 30th, AMCHAM expressed concerns about the negative impact the yellow envelope law, recently passed by the National Assembly's Environment and Labor Committee, could have on Korea's business environment and investment attractiveness. Prior to AMCHAM, the European Chamber of Commerce in Korea also expressed concerns regarding the yellow envelope law on the 28th.
AMCHAM stated that the proposed amendments expand the scope of protection for subcontract workers, limit damage claims related to disputes, and increase the legal responsibilities of management that does not engage in collective bargaining, saying that it will raise legal and operational burdens for American corporations operating in Korea and globally.
James Kim, chairman and CEO of AMCHAM, said, "A flexible labor environment is a critical element in strengthening Korea's competitiveness as a business hub in the Asia-Pacific region," adding that it is necessary to consider what signals the bill could send at a time when the 2025 APEC (Asia-Pacific Economic Cooperation) summit approaches.
AMCHAM pointed out that the amendments have been pushed forward without sufficient input despite concerns from the industrial field and stated that procedural improvements are necessary. It also added that legal and institutional improvements to establish a reasonable labor-management culture should precede.
James Kim remarked, "In last year's survey on the business environment conducted by AMCHAM, the lack of predictability in regulations was cited as a major issue for foreign corporations," adding that the yellow envelope law could exacerbate this uncertainty and ultimately negatively impact Korea's global competitiveness.