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Labor Standards Act — Article 43-4 (Restrictions on Subsidies and Support for Business Owners Habitually in Arrears)

근로기준법 제43조의4

This English translation is based on the Korean text effective 2025-10-23. The Korean law has since been amended (current version effective 2026-10-02) — check the Korean original.

(1) The Minister of Employment and Labor may designate any of the following persons (including the representative in the case of a corporation) as a business owner habitually in arrears (hereinafter referred to as "business owner habitually in arrears") after deliberation by the Committee:

1. A business owner who has failed to pay at least three months’ wages, etc. (excluding retirement benefits, etc. under Article 12 (1) of the Act on the Guarantee of Employees' Retirement Benefits) to an employee in the year immediately preceding the year which includes the date of provision of data on delayed payment of wages, etc.;

2. A business owner who has failed to pay wages, etc. at least five times in the year immediately preceding the year which includes the date of provision of data on delayed payment of wages, etc., and the total amount of arrears is at least 30 million won.

(2) Upon designating the business owner habitually in arrears pursuant to paragraph (1), the Minister of Employment and Labor shall provide the business owner with an opportunity to explain within a specified period of at least three months.

(3) The Minister of Employment and Labor may request the head of a central administrative agency, a local government, or a public institution prescribed by Presidential Decree (hereinafter referred to as "head of a central administrative agency, etc.") to take the following measures against a business owner habitually in arrears and may provide him or her with data on delayed payment of wages, etc., and upon receiving a request for data on delayed payment of wages, etc. of the business owner habitually in arrears from the head of a central administrative agency, etc. for the purpose of taking the following measures, may provide the data:

1. Exclusion from participation in various subsidy or support projects under the Subsidy Management Act, the Act on Local Government Subsidy Management, or individual statutes, or restrictions on receiving subsidies;

2. Imposition of disadvantage measures, such as points deduction, in the case of a pre-qualification for participation in tendering or the examination and determination of successful tenderers under the Act on Contracts to which the State Is a Party or the Act on Contracts to which a Local Government Is a Party.

(4) A person who is provided with data on delayed payment of wages, etc. of a business owner habitually in arrears under paragraph (3) shall not use or disclose such data for any purpose other than those prescribed in the subparagraphs of paragraph (3).

(5) The proviso of Article 43-3 (1) and Article 43-3 (3) shall apply mutatis mutandis to the procedures and methods for providing data on delayed payment of wages, etc. under paragraph (3).

(6) Other matters necessary for the calculation of three months' wages under paragraph (1) 1, the calculation of the number of arrears of wages, etc. under paragraph (1) 2, the provision of opportunities for explanation under paragraph (2), the period for providing data on delayed payment of wages, etc. under paragraph (3), etc. shall be prescribed by Presidential Decree.[This Article Newly Inserted on Oct. 22, 2024][Enforcement Date: Oct. 23, 2025] Article 43-4

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