Large Discount Stores Protest Mandatory Closure Change Ahead of Chuseok
Calls Grow Over Lack of New Hiring
Labor Unions Gain Influence After Passage of "Yellow Envelope Act"
In the retail industry, there is a growing movement among workers calling for increased staffing and the protection of workers' rights to rest. This trend has intensified since July 25, when the so-called "Yellow Envelope Act" (amendments to Articles 2 and 3 of the Trade Union Act), which strengthens the responsibility of parent companies for indirectly employed and subcontracted workers, passed the National Assembly. Analysts suggest that this reflects the growing influence of labor unions focusing on improving workers' rights in line with the new government's policy direction.
Mart union members are holding a rally opposing the mandatory holiday change coexistence and development business agreement to be signed by eight districts and counties of Daegu, the Daegu City Merchants Association, the Chain Store Association, and the Supermarket Cooperative. Photo by Yonhap News
According to the industry on September 16, the Mart Industry Labor Union of the Korean Confederation of Trade Unions Service Federation plans to hold a press conference at the National Assembly on the 17th to denounce the change of mandatory closure days during Chuseok. The issue at hand is the proposal to change the current twice-monthly mandatory closure days, which are determined in consultation between large supermarkets and local governments, to coincide with major holiday periods. While large supermarkets argue that it is more efficient to schedule closures during holidays when customer visits are relatively low, the union contends that this is a unilateral, employer-centered directive and is pushing back against the move.
A representative from the mart union stated, "For workers who plan family schedules around the twice-monthly mandatory closure days, a unilateral change in days can disrupt their plans," adding, "This only considers the sales increase of large supermarkets and goes against the intent of the Distribution Industry Development Act, which is designed to protect local small businesses such as traditional markets."
Previously, workers in the department store and duty-free sectors, which have been struggling due to sluggish domestic demand and poor business conditions, held rallies demanding increased staffing and job security. At a rally held in front of the Shinsegae Main Store in Jung-gu, Seoul on September 10, the Department Store and Duty-Free Sales Service Union called on management to address employment instability, staff shortages, and increased work intensity resulting from the implementation of maternity protection policies.
The unions claim that after the closure of the Shinsegae Duty-Free Busan branch earlier this year, employees have faced job insecurity due to long-distance transfers, and that department stores have seen brands withdraw due to poor sales. They also pointed out that with women making up 98% of the workforce, the enforcement of maternity protection policies without additional hiring has increased the workload. In duty-free shops, some brands reportedly require a single employee to run an entire store, further increasing the work burden.
Calls for more staff are also being heard in large supermarkets. Homeplus, which is expected to close 15 stores within the year following the initiation of corporate rehabilitation procedures, is a prime example. A Homeplus union representative said, "Even when there are vacancies due to retirement or natural attrition, the company does not hire new staff, so there are many cases where one person is left to handle the work that used to be shared among five people," adding, "Since new hires are not being made, stores are filling the gaps with part-timers and other short-term contract workers."
Additionally, at the Lotte Department Store branch of the Korean Confederation of Trade Unions General Service Union, there has been criticism that the new human resources (HR) system, called the 'Professional Growth-Oriented HR System,' which passed a staff vote last month with 95% approval, was adopted through an undemocratic process. This system bases promotions and evaluations on expertise rather than years of service or rank. It abolishes the previous grade system, which was based on years of service and promotion periods, and replaces it with a 'GL (Growth Level)' system based on job expertise.
On the other hand, the branch argues that while the vote received overwhelming support from employees, the process required individuals to enter their employee number and name and select either 'agree' or 'disagree,' effectively making it a named vote and restricting many employees from expressing dissenting opinions contrary to company policy. In response, Lee Sunghoon, head of the Lotte Department Store branch of the General Service Union, plans to demand that the Ministry of Employment and Labor issue administrative guidance to nullify the vote, including through one-person protests.
An industry insider who requested anonymity said, "Even if company policies are procedurally sound, there are many cases where issues are raised unilaterally, excluding the facts or disregarding employees' opinions," adding, "It is not easy for companies to respond in this atmosphere."
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