STRATEGIC PARTNERS
May 23, 2002
SEOUL, South Korea -- An agreement between South Korea's bank management and labor unions to adopt a five-day work week from July 1 is expected to boost usage of ATMs, according to a report in Asia Pulse.
The new schedule will phase out a Saturday half-day.
To smooth the transition, the Financial Supervisory Service has directed banks to expand service hours for ATM and Internet banking and not to impose penalty charges on loans maturing on a Saturday.
According to the report, other businesses fear that the shortened work week at banks will force them to adopt the same system.
The Korean Employers' Federation (KEF), the Federation of Korean Industries (FKI) and other economic organizations are concerned that the five-day-work-week agreement was made too hastily without fully addressing the need for a subsequent reduction in public holidays and wage levels.
A director at the Korea Federation of Small Business said such a move places all the burden on small and medium firms because they will also be expected to cut hours without reducing pay or benefits. In addition, since Saturdays are the busiest days of the week for small and medium-sized firms, it could lead to export and productivity losses.
Banking sources said that the five-day work week may help banks improve their earnings as expenses are reduced while interest income is maintained.
