What are the Risks of Changing Rules of Employment in Korea without the Consent of Employees?

Korean labor law imposes specific obligations on employers with ten or more employees that are not imposed on companies with fewer than ten employees. One of the significant obligations is under Article 93 of the Korean Labor Standards Act. Employers with ordinarily 10 or more employees in Korea are legally obligated to draft and maintain rules of employment. The rules of employment in Korea are a written document outlining key working conditions, including wages, hours, leave, safety, and disciplinary procedures. These employment rules must be filed with the Korean Ministry of Employment and Labor. Failure to comply with this obligation may result in a fine of up to KRW 5 million, as stipulated in Article 116(1) 2 of the Korean Labor Standards Act.

Modifications to Rules of Employment in Korea

Changing Rules of Employment in Korea (취업규칙)

Once established, rules of employment cannot be amended unfavorably to employees without consent.

Under Article 94(1) of the Korean Labor Standards Act, any change to the rules of employment requires the employer to hear the opinion of a majority trade union—or if no such union exists, the majority of employees. Crucially, if the amendment is unfavorable to employees (e.g., reducing paid leave, extending working hours, lowering bonuses), mere consultation is not enough—majority or collective consent is required. If the employer skips this step, the amended provision will be void and unenforceable—even if the new rules were filed with the Korean Ministry of Employment and Labor. In contrast, if the change is favorable to employees, it can be implemented without consent.

Whether a change is “unfavorable” depends on the specific facts and how the new rule impacts employees’ working conditions or existing entitlements. Because the legal boundary is often unclear, consulting with attorneys in Korea early in the process can prevent costly missteps and compliance failures.

Majority or Collective Consent: A Korean Legal Requirement

In Korea, employers must tread carefully when modifying employment rules that disadvantage workers. Recent precedent reaffirms that collective consent is not a procedural formality—it is a substantive legal requirement.

On May 11, 2023, the Korean Supreme Court held that an employer cannot justify an unfavorable amendment to employment rules solely on the grounds of its social or economic reasonableness, without obtaining the employees’ collective consent via a valid process that reflects the majority will—the change is invalid (2017Da35588, 35595).

The Supreme Court of Korea explained that this obligation does not arise solely from the statute’s text. Rather, it is rooted in longstanding principles of Korean labor law, such as the principle of equal footing between labor and management in determining working conditions, the protection of employees’ existing rights, and the importance of procedural legitimacy when implementing unfavorable changes.

For employers, this ruling is a practical warning that unfavorable changes, no matter how rational they may appear on paper, cannot override the structural safeguards built into Korean labor law. Failing to follow the required consent procedures may result not only in legal invalidity but also in reputational and regulatory consequences.

Need Help? Contact IPG Legal

If your company is considering a change to internal HR regulations or employment rules, it is essential to review whether such changes may require consent under Korean labor law. IPG Legal has extensive experience advising multinational companies on labor compliance, collective agreements, and employee policy updates.

by So Young YOON (Korean Attorney-at-Law)
Attorney Yoon was educated in Singapore, China, and Korea. 
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Relevant Korean Labor Standards Act Statutes

Korean Labor Standards Act, Article 116 (Administrative Fines) (1) Any of the following persons shall be punished by an administrative fine not exceeding five million won:  <Amended by Act No. 9699, May 21, 2009; Act No. 10339, Jun. 4, 2010; Act No. 12527, Mar. 24, 2014; Act No. 15108, Nov. 28, 2017>

1. A person who has failed to make a report, who has made a fraudulent report, or who has failed to attend a meeting, at the request of the Minister of Employment and Labor, the Labor Relations Commission, or a labor inspector as referred to in Article 13;

2. A person who has violated Articles 14, 39, 41, 42, 48, 66, 74 (7), 91, 93, 98 (2) or 99;

Korean Labor Standards Act, Article 94 (Procedures for Preparation and Amendment of Rules) (1) An employer shall, with regard to the preparation or alteration of the rules of employment, hear the opinion of a trade union if there is such a trade union composed of the majority of the employees in the business or workplace concerned, or otherwise hear the opinion of the majority of the said employees if there is no trade union composed of the majority of the employees: Provided, That in case of amending the rules of employment unfavorably to employees, the employer shall obtain their consent thereto.