The Future of HR in Korea: Hiring Costs, Retention, and the Yellow Envelope Act

On September 24, 2025, Pearson & Partners Korea partnered with the Italian Chamber of Commerce in Korea (ITCCK) to host an exclusive seminar at High Street Italia, Seoul. The event gathered business leaders, legal experts, and HR professionals to explore two timely themes: talent management and the Yellow Envelope Act.

Navigating HR in Korea’s Competitive Market

Justin Dohyung Kim, CEO of Pearson & Partners Korea, opened the session with a practical guide to hiring and retaining talent in Korea. His talk went beyond recruitment, addressing the hidden costs of employment, legal compliance, and the cultural nuances that determine long-term retention.

His agenda covered:

• Salary levels & real hiring costs

• Labor law basics & working hours

• Visas & foreign hiring

• Talent market challenges

• Cultural communication differences

• Retention strategies

• Pearson’s Employer of Record (EOR) services

👉 Key takeaway: Recruitment in Korea doesn’t stop at signing a contract. Success requires compliance, cultural intelligence, and engagement strategies that keep talent invested.

Highlights from the HR Session

1. The Real Cost of Hiring – Wages are only part of the equation; insurances and severance add 15–20% to base salaries.

2. Labor Law & Compliance – Strict rules on working hours and terminations mean non-compliance can be costly.

3. Visas as Strategy – Choosing the right visa (E-7, D-8, D-7) is a business-critical decision.

4. Competing with Chaebols – SMEs and multinationals can’t outspend Samsung or Hyundai but can win with faster promotions, broader roles, and flexibility.

5. Retention Challenges – High turnover among young professionals, often masked by cultural silence, makes stay interviews and career planning essential.

Legal Insights: The Yellow Envelope Act

David Park, Senior Foreign Attorney at Yoon & Yang LLC, shared an in-depth update on the Yellow Envelope Act, due to take effect in early 2026.

The Act will:

• Expand liability in subcontractor disputes

• Strengthen protections for striking workers

• Introduce new compliance risks for multinational firms

👉 Takeaway: Companies should act now by reviewing agreements, tightening internal protocols, and engaging legal advisors.

Pearson & Partners: A One-Stop Partner in Korea

Since 2017, Pearson & Partners Korea has supported global companies with end-to-end expansion solutions, including:

• Company setup

• Government licensing & permits

• Business visas

• Accounting & tax

• Payroll & talent acquisition

Through our Employer of Record (EOR) service, companies can hire in Korea without creating a local entity—reducing risk, ensuring compliance, and accelerating market entry.

In Justin’s words: “EOR gives global companies the ability to enter Korea in days, not months, and focus on growth while we handle compliance.”

Looking Ahead

The seminar underscored Korea’s position as one of Asia’s most dynamic yet complex labor markets. Businesses that invest in compliance, cultural understanding, and modern HR practices will be best prepared to attract and retain top talent.

As the Yellow Envelope Act approaches, early preparation is key. Pearson & Partners Korea remains committed to helping international firms navigate these changes with confidence.

✅ Want to learn more?
Contact Pearson & Partners Korea to explore how we can support your expansion into Korea.

👉 Also expanding into Singapore? Discover more here.

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