The so-called “Yellow Envelope Act” has led to a significant reduction in outsourced workers among South Korea’s top 500 companies, according to recent data from the Leaders Index research institute. Between 2023 and 2025, the number of dispatched and contracted workers at these firms declined by 8.2%, falling from 724,331 to 664,845. This shift coincides with the implementation of amendments to the Labor Union and Labor Relations Adjustment Act, commonly known as the Yellow Envelope Act, which took effect in 2025.
The analysis, based on employment type disclosures submitted to the Ministry of Employment and Labor’s Worknet system, covered 432 of the 500 largest companies by revenue that reported their workforce composition. While outsourced labor decreased, the total workforce across these companies actually increased slightly over the same period, rising from 1,636,571 to 1,682,397 employees.
Researchers attribute the decline in non-regular workers to corporate restructuring in anticipation of the law’s enforcement, which strengthens protections for subcontracted workers and expands union rights to include those employed through third-party agencies. The legislation aims to reduce labor insecurity by making it more challenging for companies to avoid collective bargaining obligations through outsourcing arrangements.
Although the Yellow Envelope Act has been praised by labor advocates as a step toward greater equity in the workplace, business groups have expressed concerns about its potential impact on operational flexibility and increased labor costs. The debate reflects broader tensions in South Korea’s economy between ensuring worker protections and maintaining competitiveness in a global market.
As of April 2026, the law remains in effect, and ongoing monitoring by government agencies and independent research institutes continues to assess its influence on employment patterns across industries. No further legislative changes to the act have been announced as of this date.
For ongoing updates on labor policy developments in South Korea, readers can refer to official publications from the Ministry of Employment and Labor or follow updates from reputable sources such as Yonhap News Agency and The Korea Herald.