MOEL plans to reduce working hours to strengthen its job creation policy
The Ministry of Employment & Labor (MOEL) has announced a plan to create jobs by revising the Labor Standards Act to include holiday work in ‘extended working hours’ and reduce the number of sectors where exceptions apply. The MOEL will strengthen its monitoring over the long working hour practices at automobile factories with 500 or more workers. However, as companies became more concerned about the impact of this policy on their business, the MOEL announced at the Council on Job Creation through Public-Private Partnership (14th Feb) that working hour reductions would be carried out gradually, with the size and characteristics of the company taken into consideration. In this way, the government hopes to minimize confusion in workplaces over the changes that working hour reductions will bring.
FKTU activities for 2012 and discussion on payment for union officials dispatched to umbrella unions
In 2012, the Federation of Korean Trade Unions (FKTU) has 12 major goals for labor and social reform, which they hope to achieve through political and labor strife. With this in mind, the FKTU plans to include these 12 major goals in the Democratic United Party’s (DUP) election platform for labor and social reform, and submit it to the National Assembly in June for legislation. The FKTU is also expected to make other demands: a 9.1% wage hike for regular workers, a 19.4% hike for non-regular workers, and a minimum wage of ₩5,558 per hour (₩44,464 per day) in 2013.
Meanwhile, the FKTU is expected to continue the discussion on payment to union officials dispatched to umbrella unions. At a special convention held on December 8, 2011, the FKTU proposed that activities by union officials dispatched to umbrella unions be financed by industry-level unions and that the FKTU would provide up to ₩4 million per month, which however failed to pass due to lack of a quorum. The FKTU plans to table this proposal again to the regular convention on February 28.
【 Table 1 】 FKTU Platform: 12 Major Goals on Labor & Social Reform
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① Reform tax law (Financial income tax, Tax on the wealthy, etc.)
② Abolish KORUS FTA
③ Reform conglomerates (Separate banking and commerce, share profits, etc.)
④ Support SMEs
⑤ Revise the Trade Union Act (TULRAA)
⑥ Revise social dialogue systems and establish democratic governance in industrial relations
⑦ Reduce working hours
⑧ Strengthen job security such as restricting layoff
⑨ Rationalize the minimum wage and guarantee basic livelihood
⑩ Reduce the numbers of non-regular workers and abolish associated discrimination
⑪ Introduce an unemployment subsidy and establish employment governance such as fund management for vocational training by labor-management
⑫ Improve the social welfare system towards universal welfare
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Labor groups increase political activities and politicians introduce labor-friendly policies in view of the general elections ahead
The DUP has appointed a number of FKTU officials to its Labor Committee, and plans to introduce its platform on labor issues in early March, in alliance with the FKTU. Key features include employment stability, inducing civil groups to engage in labor relations and universal welfare. With the aim of having its proposals included in the DUP election platform, the FKTU plans to use its policy advisory group as a ‘think tank’ for the DUP’s general election strategy team.
Meanwhile, the Saenuri Party has proposed plans to improve the non-regular work situation, but these plans seem too burdensome for business, causing investment to fall, negatively impacting job creation.
【 Table 2 】 Measures Proposed by the Saenuri Party on Non-Regular Work
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① Include non-regular workers in performance bonuses
② Abolish non-regular employment in the public sector by 2015, and give open-ended contracts to non-regular workers in the private sector
– In the public sector, new staff to be hired as regular workers
– Large companies to communicate employment types when recruiting
③ Introduce an Act on the Protection of In-house Subcontract Workers
– User employers to ensure payment to subcontract workers
– Discrimination between regular workers and in-house subcontract workers engaged in similar work to be prohibited
– User employers to apply the previous employment and working conditions when changing their subcontracting company
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The Unified Progressive Party (UPP) has also announced its labor-related election pledges for the April 11 general elections, such as increasing the unionization rate to 20%, legislation of ‘equal wages for equal work’ and improving the minimum wage system. Further, the UPP plans to sign a policy coalition with the KCTU.
【 Table 3 】 Major Election Pledges of the Unified Progressive Party
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① Boost unionization rate to 20% and collective bargaining implementation rate to 50%
② Legislate ‘equal wages for equal work’ and limiting the areas of using non-regular employment, and impose a new tax on companies with many non-regular workers.
③ Establish special laws on working hour reductions and job creation
④ Improve the minimum wage system
⑤ Abolish the National Labor Relations Commission and establish a Labor Court
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Activities of major industry-level unions in 2012
The Korean Metal Workers’ Union (KMWU) held a special convention on February 27 to finalize its 2012 activities. The KMWU’s activities for 2012 include a full-scale industry-level strike between late June and early July, and participation in a general strike led by the KCTU between late August and early September. The intensity of this second strike in 2012 may depend on the participation of auto workers, which may be limited as Renault Samsung Motors, SSangyong Motors and GM Korea are unlikely to participate because of a lack of adversarial sentiment.
The Korean Public & Social Services and Transportation Workers’ Union (KPTU) is planning to get involved in the non-regular employment issue in January and February through their Working Group for Abolishment of Non-regular Employment. The KPTU is also expected to be part of the political wrangling leading up to the general elections, as well as labor unrest after the elections, with revisions in two areas in view: minimum wage and laws regarding the operation of public institutions.