Collective turnover and firm performance: the joint effects of working time-reducing human resource practices and human capital flow and composition under the 52-hour rule in South Korea

Abstract

ABSTRACT This study examines whether the effect of collective turnover can be contingent upon working-time reducing human resource (HR) practices and human capital flow and composition (i.e. the hiring ratio of newcomers and the ratio of contingent workers) in the context of the 52-hour rule in South Korea (hereafter Korea). As the Korean government shifts from a 68-hour workweek to a 52-hour workweek system, firms are implementing various working-time reducing HR practices, potentially affecting collective turnover and human capital. Analysing 273 Korean firms, we find that higher collective turnover relates to lower firm performance, especially with increased working-time HR practices. However, employing more contingent workers mitigates this negative impact. Our study contributes to the literature on collective turnover and strategic human resource management by suggesting that working time-reducing HR practices should be carefully utilized in the context of the 52-hour rule in Korea.