“Yellow Envelope Law” Passes in South Korea: A Victory for Workers

Kokcha News Agency – South Korea’s National Assembly has approved a labor reform bill, dubbed the “Yellow Envelope Law,” despite opposition from conservative lawmakers who argued it would harm businesses in Asia’s fourth-largest economy.

The new law allows subcontractor unions to make direct demands on client companies, limits employers’ ability to seek compensation for damages caused by strikes, and expands the liability of managers who refuse collective bargaining.

The ruling Democratic Party pushed the bill to a vote, overcoming attempts by the main opposition People Power Party (PPP) to block it. The PPP eventually boycotted the session, and the bill passed with 183 votes in favor and 3 against.

The Korean Confederation of Trade Unions (KCTU) hailed the law as the “historic fruit” of decades of struggle, stating that the “simple and undeniable truth” that all workers can unite and bargain has finally been enshrined in law. The KCTU called on the government to take measures consistent with the spirit of the bill.

However, business groups condemned the outcome, warning that it would harm competitiveness and deter investment. They argued that the vague definitions of “employer” and “labor disputes” could fuel legal conflicts and urged lawmakers to clarify the bill and work with the business community during a six-month transition period to “minimize the law’s impact.”