52-Hour Workweek Exemption for Semiconductor Industry to Be Handled via Executive Decree

The 52-hour workweek exemption for the semiconductor industry will be implemented through an executive decree rather than a new law.

At a meeting he chaired at the presidential office on the 23rd, President Lee Jae-myung instructed relevant ministries to "discuss in depth whether there is a way to amend the existing decree or simplify the procedures" regarding the labor special exemption from the 52-hour workweek that the semiconductor industry has long demanded. While a proposal to include a labor exemption clause in the Mega Special Zone Act — designed to support large-scale investment areas such as the Gwangju semiconductor cluster in South Jeolla Province — had been under review, the government ultimately opted to improve the current system rather than pursue legislation. In effect, this amounts to a retreat from efforts to codify the exemption into law.

Why the Labor Exemption Became a Contention Point

The Labor Standards Act in principle prohibits work exceeding 52 hours per week. Because semiconductor manufacturing requires continuous equipment operation and maintenance due to the nature of its processes, the industry has long demanded an exemption for research and development personnel. The same issue repeatedly surfaced during past discussions of the Advanced Strategic Industries Act. This time, a bill to insert a special exemption clause into the Mega Special Zone Act supporting large-scale investments such as the Gwangju cluster had been submitted to the National Assembly. The move reflects the industry's judgment that working-hour regulations pose an obstacle to investment amid fierce competition to attract capital.

What Amending the Decree Would Change

The current system already includes a permit process for special extended overtime work. However, the industry has consistently pointed out that the site-by-site approval process is cumbersome and time-consuming. President Lee's question — "whether a new system is needed or whether amending the existing decree is sufficient" — ultimately points to administrative improvements that would loosen the scope of approvals and streamline procedures. Since it can be implemented simply by revising the Ministry of Employment and Labor's decree without amending the law, the time required is drastically reduced. On the other hand, unlike an exemption enshrined in law, a relaxation at the level of government directives could be reversed by a future administration.

Labor Opposition and Political Variables

Opposition to expanding the labor exemption is far from negligible. Labor groups have maintained their opposition, arguing that the 52-hour exemption could lead to overwork and industrial accidents. With voices within the ruling party also known to be cautious about easing working-hour rules, analysts say the political burden would have been too great to push the exemption into law. The decision to amend the decree instead is interpreted as a compromise that secures the practical benefit of supporting investment while sidestepping a legislative battle in the National Assembly. For companies, simplified procedures would have a substantial impact, but labor groups point out that safeguards against abuse of the pre-approval process must be put in place as well.

Timeline and Market Impact

For now, relevant ministries are expected to review which provisions of the current decree to revise. The Mega Special Zone Act itself is now likely to pass without the labor clause. For foundry and fabless companies, which are sensitive to fab utilization rates and shortened production timelines, streamlined procedures alone are expected to significantly increase workforce flexibility. However, administrative steps — including advance notice of the decree revision and regulatory review — will take at least several weeks. As the saying goes, success is not a single decision but the accumulation of execution: for this directive to deliver real results, the key will be how the implementation process strikes a balance between worker protection and attracting investment.