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Samsung to introduce 10-minute overtime pay

Change from 2-hour increments designed to prevent workers from staying late

Samsung workers appear optimistic that getting paid for overtime in 10-minute chunks will increase their take-home. (Courtesy of Samsung Electronics)
Samsung workers may be in line for greater take-home pay now that overtime will be divided into 10-minute chunks. (Courtesy of Samsung Electronics)

SEOUL -- Samsung Electronics will start paying employees for overtime work in 10-minute increments next month, a move expected to increase take-home pay for many staff as the conglomerate works to please the growth-minded Moon Jae-in administration.

The company currently pays overtime in 2-hour increments. The change will coincide with a lowering of the national cap on working hours to 52 per week including overtime from 68 under a revised labor standards law, in response to which Samsung will also give employees more flexibility in setting their schedules.

Along with targeting South Korea's family-run business empires, or chaebol, for reform, the Moon government hopes to unleash economic growth through higher household incomes.

Samsung's new overtime policy appears to target staff in semiconductor and display operations, and may be expanded down the road to those working in smartphones and other areas. The South Korean company will end its practice of paying employees the equivalent of between $10 and $20 for every two hours of overtime worked and referring to it as "transportation expenses."

Samsung will also from July begin paying employees 50% more for hours worked after 10 p.m. It already pays employees a premium for working on weekends, but had not used a precise hourly overtime pay system for weekdays.

Many South Korean companies build a certain amount of overtime pay into workers' monthly salaries, as Samsung has done. Businesses rarely calculate overtime pay based on actual hours worked, and even at those that nominally do so, the process appears to have essentially become a formality. But many follow Samsung's lead in matters of hiring and pay systems, meaning changes it makes internally may spread throughout the business community.

Samsung employees appear to see an increase in monthly pay on the horizon as a result of the policy change. The 10-minute system is expected to eliminate the issue of employees finishing their extra work in an hour or so and having to stay another hour to qualify for overtime pay.

Some are worried that the system could backfire, however. Many Samsung employees work at least 52 hours a week, which will be the legal limit as of next month, and there are concerns that the new policy could create a widespread issue of employees continuing to work from home without pay.

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