The government is pushing to revise the Labour Standards Act to introduce a “worker presumption rule” from May 1, Labour Day, and the platform industry is worried about the fallout.

Industry officials said on Jan. 29 that if the rule is introduced, platform businesses across delivery, content and staffing brokerage are expected to be affected. The Ministry of Employment and Labor is promoting the Framework Act on the Rights of Working People, and amendments to the Labour Standards Act. The core is shifting the burden of proof.

Until now, special employment workers and freelancers had to prove they were workers themselves when seeking wages or severance pay. Under the change, businesses would have to prove factors such as a worker’s independent operation, absence of direction and supervision, and freedom to decide working time and place. If they fail to do so, the person would immediately be presumed to be a worker, and companies would take on legal obligations including minimum wage, severance pay and the four major social insurance programmes.

DELIVERY INDUSTRY SAYS COST PASS-THROUGH INEVITABLE; RIDERS SHUN FULL-TIME JOBS

Delivery platforms are expected to take the most direct hit. The industry estimates that directly hiring about 400,000 riders would generate additional annual labour costs of at least 200 billion won. It would lead to higher delivery fees and consumer prices, and ultimately result in reduced hiring, the analysis says.

A delivery app official said, “The government views full-time employment as an absolute good and is trying to force all work types into that mould.” The official criticised it as “excessive regulation” that could reduce platform competitiveness and even lead to withdrawals.

The industry says demand for full-time jobs is not strong on the ground. Another delivery platform official said, “The biggest advantage of being a rider is earning as much as you work.” The official added, “Even during COVID-19, there were many complaints about fewer jobs, but calls for full-time positions were rare.”

Delivery&Co, a subsidiary of Woowa Brothers’ logistics unit Woowa Youth, tried in 2022 to recruit 100 full-time riders with conditions including a base salary of 47 million won, the four major social insurance programmes and motorbike leasing fees. It hired up to 40, later fell sharply to around 10, and closed the business at the end of last year.

CONTENT AND STAFFING BROKERAGE SEEN CLASHING OVER BURDEN OF PROOF

The content industry, including webtoons, is also in the affected range. In a supply structure that runs from platform to content provider to writer, who bears the burden of proving worker status is a key issue. Such conflicts are already becoming reality. The Webtoon Labor Union is fighting by demanding direct negotiations excluding content providers from Kakao Entertainment and others.

Platforms see producer feedback as an exercise of editorial rights, but labour groups counter that manuscript revision instructions and deadline management amount to substantive work orders. The structure in which writers hire assistants is also an issue. Writers must prove they are platform workers, while bearing employer responsibility for assistants.

A webtoon industry official said, “Many writers use assistants, and if the bill takes effect, the burden of proof related to them will become entangled, so the impact will be significant.”

Freelancer platforms such as Soomgo and Kmong fall into the indirect impact range because they leave final pricing and work execution to the parties. Still, there could be legal responsibility if they are excessively involved through presenting standard unit prices or mediating disputes.

An official at a staffing brokerage platform said, “The bill is under parliamentary discussion and detailed standards are undecided, so it is difficult to definitively say what the impact will be at this point.”

Labour groups, meanwhile, agree with the purpose of the system but are calling for supplements. The Korean Confederation of Trade Unions said in a statement on Jan. 20, “The current presumption system is only set at the level of labour inspector rules, so it is highly likely to be applied in a limited way only at the dispute resolution stage.” It added, “It should be improved so that worker status determinations are broadly applied across labour relations overall.”