[asia-apec 267] Government Retreats on Labour Law Reforms

[KCTU-International]

KOREAN CONFEDERATION OF TRADE UNIONS
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          Struggle for Labour Law Reforms
               Campaign News XIV
                 December 4, 1996


Labour Law Retreat, Regress, Regrets

Korean government formally announced its proposal for the 
amendment of the labour laws.  The proposal was revealed by 
Prime Minister Lee, Soo-sung, on December 3, 1996, in a live 
television broadcast. Kim Young Sam government aims, 
according to this proposal, to legislate broad employer powers 
to layoff worker, bring in replacement (scab) labour during a 
strike, and order employees to work a maximum of 56 hours a 
week without overtime payment. At the same time, the changed 
law will continue the current system of compulsory arbitration 
for broad range of enterprises while postponing the introduction 
of 'union plurality' at the shopfloor level for 5 years. The 
proposed amendment also calls for legal codification of a ban 
on wage payment for the period of strike and a ban on wage 
payment for full-time union officers. The proposal, while paving 
the way for the introduction of 'union plurality' at the federation 
and confederation levels, introduces new conditions which may, 
in effect, prohibit the legal recognition for the Korean 
Confederation of Trade Unions and most of its affiliated 
industrial federations. Furthermore, the government proposal 
calls for the continued ban on the unionisation of government 
employees and teachers.
    The "reform of labour laws" proposed by the government, 
in reality, will have the effect of, on the one hand, critically 
undermining the basic freedom and right of collective bargaining 
and strike, and on the other, severely worsening the working 
conditions and workers' welfare.


Restriction of Association and Collective Bargaining

    The government proposal for the "reform of the labour 
laws" makes clear what President Kim Young Sam meant 
when he called for the establishment of a "new system of 
industrial relations". It will be one where unions are powerless 
while employers are given unlimited powers over workers.

    Legal Recognition for KCTU: New Obstacle

    The proposal will pave the way for legal recognition for the 
Korean Confederation of Trade Unions and most of its affiliated 
federations. These organisations, however, may have to 
"dismiss" their current elected officers and forced to seek new 
leaders to obtain legal recognition. This is because most of the 
leaders, including president Kwon Young-kil and general 
secretary Kwon Yong-mok of KCTU, and president Dan 
Byung-ho of the Korean Federation of Metalworkers Unions, for 
example, are "dismissed workers" who are ineligible for union 
membership or office under the to-be-revised law.
    The present and revised law does not recognise the 
freedom and right of unions and their federations to induct 
(elect) leaders of their choice to represent and advance their 
interests. The situation is aggravated by the proposed changes 
in the eligibility of union membership. Currently a dismissed 
worker can maintain his/her union membership until the validity 
of the dismissal is decided by the Supreme Court, the highest 
court in the land. The proposed amendment, however, limits 
people eligible to join a union to persons who have a direct 
employment contract with an employer while a dismissed 
worker can maintain his/her union membership until the 
decision of the appeals hearing by the Central Labour 
Commission. As a result, the union membership of a worker 
who challenges the dismissal can be terminated within 2 to 3 
months.
    President Kwon Young-kil's claim to his position in KCTU 
may no longer be "legal" as his challenge against the validity 
of his dismissal is currently being heard in the appellate court, 
having exhausted the administrative relief procedures provided 
by the Central Labour Commission. KCTU, hence, may be 
barred from legal recognition as long as it maintains that 
president Kwon is the rightful leader of the organisation. 

    Legal Recognition for Teachers Union? NO!

    The government "reform" package remains unclear on the 
freedom of association for teachers. Nevertheless, one thing is 
clear. The new law will not allow right of teachers to form or 
join a union. And whatever organisation teachers form will not 
be allowed to use the term "(trade/labour) union" in its name 
nor affiliate with a trade union federation, such as KCTU. 
    According to the proposal, the government will revise the 
existing "Special Act for Promotion of the Status of Teachers" 
to allow for the existence of multiple teachers organisations.  
However, this body will only have limited consultation rights 
and will be without any right to take collective action. The 
government proposal falls far short of the demand for legal 
recognition of the Korean Teachers and Educational Workers 
Union. The proposal calls, also, for the maintenance of the 
current ban on freedom of association for government 
employees. This means that some 600,000 white-collar workers, 
apart from the manual labourers employed in public services, 
will not be allowed to form or join trade unions.

    Crippling the Right to Strike

    The government proposal introduces new rights of 
employers to by-pass the effect of a strike. The proposal calls 
for a revision of current law concerning replacement of 
striking workers. The current law prohibits hiring of new 
employees, deployment of replacement labour, and engagement 
of new sub-contracting agreement. The current law, however, 
allows for deployment of non-striking workers within the same 
company to take over the work of striking workers. However, 
with the revision proposed by the government, employers will 
be able to deploy worker from the same business concern. 
This means that a conglomerate company which has a number 
of subsidiaries can deploy workers from any one of its 
subsidiaries to replace the striking workers in one of its 
subsidiaries. The revised law will also allow hiring new 
employees on temporary basis in case of a union shop 
company. Worst of all, the amended law will allows employers 
to engage new sub-contractors during a strike. 
    The amendment of labour laws proposed by the 
government will also introduce other measures which will 
critically restrict the right of collective action. 
    The proposal calls for a legislative codification of 
'no-work no-pay', prohibiting the payment of wages (or other 
kinds of payment in lieu of the wage) for the period of a 
strike. By codifying such a clause, which can best be left to 
collective bargaining, the government is, in effect, aiming to 
create a restriction on the right to bargain collectively and the 
right of collective action.
    The revised labour laws, according to the proposal, will 
continue to extend the ban on industrial action to banks, 
telecommunication enterprises, and all hospitals, by including 
these in the list of "public service enterprises" which are 
subject to "compulsory arbitration".

    Restriction on Trade Union Activities

Eligibility of Union Membership. 
    The government proposal will severely restrict the recourse 
available to unionists to challenge "unfair" dismissal. Currently, 
a dismissed worker can maintain his/her union membership until 
the Supreme Court (the highest court of the land) brings down 
a verdict on the validity of the dismissal. However, under the 
to-be-revised law, dismissed worker can main his/her union 
membership only until the decision of the appeals hearing of the 
administrative Central Labour Commission. Given the prevalence 
of retaliatory dismissals -- aimed at disrupting the normal function 
of a union -- against key union leaders, the proposed change will 
bring about serious restriction on the trade union activities.

Ban on Wage Payment to Union Officers
    Greater restriction on trade union activities can be foreseen 
from the proposed ban on payment of wages to full-time 
union officers. The proposed amendment will define the 
payment of wage to full-time union officers as an "unfair labour 
practice". The total ban will come in place in 2002 when 
multiple unions will be allowed at the shopfloor level. However, 
the revised law will call for a graduated reduction in the total 
amount of wage paid out as wage to full-time union officers. 
The government explained that no country among the OECD 
members allows payment of wage to union officers to justify 
the new legislation. The government argument, however, 
overlooks the fact that large number of shopfloor-based union 
officers in many OECD countries, including Germany, England, 
and France, are paid wage. Furthermore, the issue of wage 
payment in these countries is not codified in a law but left as 
a matter to be decided by a collective bargaining agreement. 
The KCTU believes the government proposal reflects an 
intention to create difficulties for union operations rather paving 
the way for an improved industrial relations. Such a ban will 
have severe impact on trade union movement in Korea given 
its enterprise-level union system enforced by the law.

Disruption of Union Internal Democracy and Autonomy
    Autonomy of union activities will also be impaired due to 
the enforcement of the right and power of the union 
representative to adopt a collective bargaining 
agreement. Under the current law, a representative of a union 
is defined to have right and power to engage in negotiation 
with the employer for a collective bargaining agreement. This 
has allowed unions to adopt a constitution and rules which 
enables the union to call a general meeting of the membership 
to "ratify" or refuse a provisional agreement reached between 
the union and management negotiators. By changing the law to 
give the union representative engaging in a CBA negotiations 
not only the right and power to negotiate but also the right and 
power to adopt an agreement, the government severely restricts 
the autonomy and internal democracy of unions. Once the 
changed law comes into effect, the constitutions and rules 
adopted by most of the unions will be seen as violating the 
law.

    The Ban on Political Activities by a Trade Union

    The proposed amendment calls for the repeal of the 
prohibition on political activities by a trade union stipulated in 
the current Trade Union Act. The Ministry of Labour 
background paper on the government proposal states, "it is not 
desirable, in the light of the practices in the advanced 
industrialised countries, to stipulate additional restriction in the 
industrial relations law" because, "the laws governing political 
activities and elections already prohibit political activities of a 
trade union as with other social organisations". The same 
backgrounder cites the relevant other laws, such as, the Article 
12 of the Political Funds Act and the Article 87 of the Act on 
Election of Public Offices and Prevention of Election Corruption, 
which prohibit donation of political funds or election campaigns 
by a trade union.


Freedom of Employers

    The meanness of changes "in favour" of trade unions 
stands in stark contrast to the "concessions" made to the 
employers. The government proposal for the revision of the 
labour law embraces all the demands of employers -- the 
Federation of Korean Industrialists and the Korean Employers 
Federation, the Chamber of Commerce, etc. -- apart from the 
their call to maintain the current prohibition on union plurality. 
    The proposed amendments will virtually give free hand to 
employers to layoff workers. It will also allow employers to 
demand employees to work a maximum of 56 hours a week 
(without overtime rate) as long as the monthly average remains 
within 44 hours. The proposed revised law does not contain 
any indication for the reduction of working hours. The 
government proposal will also bring about a legislation which 
will institutionalise "dispatch labour" or "contingency workforce".  
The proposed legislation will have the effect of legalising the 
currently illegal "manpower agencies" operated by the big 
conglomerate chaebols. The three "flexibility" measures will, 
together, will, the KCTU believes, severely disrupt the 
employment security and trade union activities.


The General Strike: the looming crackdown

    On December 4, 1996, the member unions of the Korean 
Confederation of Trade Unions, including the unions at the 
major car makers and heavy industries with thousands of 
employees, conducted a pre-strike ballot. While the exact 
figures are not yet known, the results so far indicate that more 
than 90% of workers in some 300 unions which have so far 
conducted the ballot have voted to go on a general strike. 
    The Korean Confederation of Trade Unions will hold an 
extraordinary session of its Central Committee on December 6 
to decide on the date(s) and form(s) of nation-wide general 
strike. 
    In response to the call for general strike, the government 
has responded by threatening to arrest and imprison the key 
union leaders who "instigate" an "illegal" general strike. A high 
level Public Prosecutors Office officer suggested president 
Kwon Young-kil, who is out of jail on bond while still facing a 
trial, may be "recalled" to prison once the KCTU embarks on 
the general strike. KCTU expects large number of arrests and 
imprisonments as 500 union leaders vowed to end up in prison 
in their determination to resist the government amendment 
which will severely restrict trade union rights and radically 
worsen the working conditions.