[K Population Strategy] Large Corporations' Promised 'Gender Work Disclosure System' for Next Year... Related Ministries Have Not Even Started [Exclusive]

Preparation Not Ready for Introducing Private Sector Disclosure
Only 'Public Sector Disclosure' Already Implemented
'Voluntary Disclosure' for Companies? Risk of Remaining a Campaign Promise
Academia Calls for "Legislation and Disclosure Incentives"

The Yoon Seok-yeol administration presented the ‘Gender Labor Disclosure System’ as a national agenda and was expected to apply it to the private sector next year, but it has been found that the relevant ministries have not even started preparations.

The Gender Labor Disclosure System is a system established with the purpose of ‘creating a fair labor environment,’ which discloses gender information including recruitment, job categories, duties, wage components, and wage gaps. Although it is one of President Yoon Seok-yeol’s election pledges and national agendas, the government holds the position that sufficient review is needed for disclosure by private companies. There are also criticisms that since it is premised on voluntary disclosure, the promotion itself will not be easy.

[K Population Strategy] Large Corporations' Promised 'Gender Work Disclosure System' for Next Year... Related Ministries Have Not Even Started [Exclusive]

[Image source=Yonhap News]

Ministry of Employment and Labor and Ministry of Gender Equality and Family also "Don’t Know"

The deadline for introducing the disclosure system for large corporations is approaching, but preparations by the relevant ministries remain at a standstill. It has been found that they have not even started the practical procedures for disclosure in the private sector. A Ministry of Employment and Labor official said in a phone interview with Asia Economy on the 18th, "We are currently considering how to implement disclosure in the private sector."

The Gender Labor Disclosure System was also promoted during the Moon Jae-in administration, but unlike the ‘Gender Equality Wage Disclosure System,’ which did not reach mandatory disclosure, it includes a voluntary disclosure clause. Accordingly, the Ministry of Gender Equality and Family deliberated and approved the plan to introduce the Gender Labor Disclosure System in the ‘3rd Basic Plan for Gender Equality Policy (2023?2027)’ on January 26 last year. At that time, the government announced that it would start a pilot operation in the public sector from last year and apply it to large corporations with 500 or more employees from 2025. The Ministry of Employment and Labor was tasked with preparing a phased introduction plan, and the Ministry of Gender Equality and Family was responsible for investigating and announcing the status of gender wage gaps among employees of listed companies and public institutions annually.

Source: 20th Presidential Election People Power Party Policy Pledge Book

However, in the private sector, neither the establishment of standards for disclosure nor research service work has been carried out. Even with a voluntary disclosure method, specific methods to induce disclosure are necessary. A Ministry of Employment and Labor official explained, "It is necessary to review methods such as how and which items should be disclosed," adding, "Since disclosure itself is a huge burden for private companies, sufficient consideration is needed on ways to make it easier for them to disclose."

The Ministry of Gender Equality and Family also does not have data on the private sector. A ministry official said, "In the case of private sector introduction, the Ministry of Employment and Labor is the lead ministry," and "The Ministry of Gender Equality and Family is not separately promoting anything." Without detailed plans for disclosure in the private sector, it will be difficult to realize gender wage gap disclosure for private companies.

Even Public Institution Disclosures Only Show ‘Average Values’

[Image source=Yonhap News]

Instead, the Ministry of Employment and Labor explained that it has been working on supplementing the public sector gender labor disclosure system since last year. This means that the ‘job transition stage indicator’ was added to the pilot operation system. Indicators related to public sector gender labor disclosure are currently disclosed on the Public Institution Management Information Disclosure System (ALIO), Local Public Institution Management Information Disclosure System (Clean Eye), and the Gender Labor Disclosure Pilot Operation System (AA-NET), respectively.

However, this information is already publicly available. Since the first implementation of Affirmative Action (AA) in 2006 and the ‘Act on Equal Employment and Support for Work-Family Balance’ (Equal Employment Act) in 2019, the wage status by gender, job category, and rank has been disclosed. Under the Yoon Seok-yeol administration, the Ministry of Employment and Labor revised the enforcement regulations in 2022, changing the submission of gender wage status information, which was previously divided by job category and rank, to only submit the overall male and female averages from last year.

The Ministry of Gender Equality and Family annually announces the results of wage gap surveys for listed companies and public institutions on its own. According to Article 20 of the Framework Act on Gender Equality, the Minister of Gender Equality and Family may investigate and announce the number of executives by gender and wage status of corporations subject to business report submission under the ‘Capital Markets and Financial Investment Business Act.’

This is done by analyzing the business reports of listed companies submitted to the electronic disclosure system (DART) and gender wage-related information disclosed on ALIO. However, this does not include detailed elements such as recruitment, job category, duties, and wage components by company, so no responsibility is assigned to each company.

The National Assembly Also Demands ‘Legislation of Gender Labor Disclosure’

The wage gap remains an unresolved issue in our society. Since joining the Organisation for Economic Co-operation and Development (OECD) in 1996, Korea has consistently ranked first in gender wage gap among member countries for 26 years. According to the ‘Korea Sustainable Development Goals (SDG) Implementation Report 2024’ published by Statistics Korea last month, Korea’s gender wage gap was 31.2% as of 2022, the largest among the 35 OECD member countries. Korea was the only country with a wage gap exceeding 30%, which is 2.6 times higher than the OECD average (12.1%).

For this reason, many political parties proposed the introduction and legislation of the Gender Labor Disclosure System as an election pledge in the 22nd National Assembly general election. The Green Justice Party and the Democratic United Party proposed the introduction of the Gender Equality Wage Disclosure System, legislation of the wage disclosure system, and phased mandatory implementation, respectively. The New Progressive Union also pledged to introduce the gender wage disclosure system for companies with 300 or more employees. The Progressive Party urged the implementation of gender equality index evaluations starting from companies with 100 or more employees.

Academia also voices opinions that discussions on legislation and mandatory disclosure beyond corporate gender wage gap disclosure are necessary. According to the 2022 study ‘Tasks for Introducing the Gender Disclosure System’ by the National Assembly Legislative Research Office, "As a complete gender disclosure system including the private sector, employment gaps and wage gaps should be captured, and specific and individual information disclosure should be procedurally guaranteed," adding, "For this, clear legal grounds are needed through separate legislation."

Considering the reality such as corporate opposition, if voluntary disclosure is induced for private companies, it is also necessary to strengthen incentives as a complementary measure. Jeon Ki-taek, head of the Work and Life Research Division at the Korean Women’s Development Institute, said, "Even if disclosure is legislated, it is difficult to secure execution power if the company does not disclose," and "If promoted as voluntary disclosure, complementary measures such as strengthening corporate incentives should be considered together."