Paid Leave, Celebration Bonuses, Reduced Working Hours... Retail Industry Rolls Up Sleeves to Support Low Birthrate

Lotte Department Store Improves Welfare System
Focus on Overcoming Low Birthrate Issue
Expectations for Industry-wide Expansion in Retail Sector

Lotte Department Store has significantly revamped its employee welfare system to overcome the low birthrate issue. It is meaningful that a distribution company has come up with countermeasures in response to the low birthrate problem, which is deepening and emerging as a national agenda. This is expected to serve as a catalyst for the spread of low birthrate countermeasures throughout the distribution industry.

According to the industry on the 5th, Lotte Department Store has prepared an improved welfare system that includes expanding infertility support for married employees. Until now, infertility treatment expenses were supported if there were no children within five years after marriage, but from now on, support can be received after just three years. In addition, a one-night, two-day prenatal education trip is supported, and the congratulatory money for the first childbirth has been raised from 100,000 won to 1,000,000 won.

Lotte Department Store Main Branch
[Photo by Lotte Department Store]

Through this welfare system improvement, Lotte Department Store also established the 'Our Child's First Step Leave.' The main point of this leave is that employees with children entering daycare centers or kindergartens can take two days of paid leave in the month of admission. The existing 'Elementary School Admission Care Leave' usage method has also been improved so that care leave can be used as paid leave regardless of annual leave usage.

Lotte Department Store explained that this welfare system was prepared by collecting opinions from working mom employees. A Lotte Department Store official said, "We actively reflected opinions to create an environment where employees can feel psychological stability during pregnancy, childbirth, and childcare periods and focus on their work, thereby upgrading the existing welfare system."

Previously, most distribution companies, including Lotte Department Store, have operated welfare systems to support childcare, such as implementing mandatory paternity leave for men. However, it was said that systems to overcome the low birthrate were relatively insignificant. In fact, looking at the welfare systems of other distribution companies except Lotte Department Store, it is difficult to say that they properly reflect the current situation where the total fertility rate has fallen below one.

Shinsegae guarantees a reduced working period (5 hours) throughout the pregnancy period and a maximum of three years of childbirth and childcare leave. It also implements infertility female leave and child admission care leave. A congratulatory money of 100,000 won is paid for the first childbirth. These contents can be found in the welfare systems of other distribution companies such as Hyundai Department Store and CJ, with some differences in the length of leave and the scale of working hour reduction.

Currently, the low birthrate issue is regarded as a social problem. According to Statistics Korea, last year, South Korea's total fertility rate (the average number of children a woman is expected to have during her childbearing years from ages 15 to 49) dropped to 0.78. This is interpreted as an indicator that the country has entered a representative low birthrate nation. Given this situation, the government is also introducing various support policies for low birthrate and childcare. President Yoon Suk-yeol personally chaired the Low Birthrate and Aging Society Committee meeting in March and emphasized, "The low birthrate issue is an important national agenda."

In the distribution industry, there is growing expectation that Lotte Department Store's welfare system improvement focused on overcoming the low birthrate will become a starting point for spreading throughout the industry. Shin Nam-sun, head of Lotte Department Store's HR division, said, "We hope that the improved employee welfare system will help to some extent in overcoming the widespread low birthrate and childcare issues in our society."