1. Political intervention in individual labor disputes may worsen the business environment
On September 12, the Environment & Labor Committee decided to summon a large number of businessmen for a parliamentary investigation: 25 people concerning massive layoffs at Ssangyong Motors, including Mr. Lee Yoo-il, CEO of Ssangyong Motors, and Mr. Min Euoo-sung, the former chairman of the Korea Development Bank; and 20 in relation to violence to workers including Mr. Kang Chun–gi, CEO of SJM, and Mr. Park Jong-tae, CEO of CONTACTUS (Security Service Company).
Labor groups and opposition parties are seeking to intervene in labor disputes at company level. In particular, after the hearings on Ssangyong Motors and SJM, labor groups are expected to demand parliamentary investigations and hearings on other labor disputes. The FKTU released a statement demanding a parliamentary investigation of Ssangyong Motors, and the National Union of Media Workers (NUMU), affiliated with the KCTU, announced that they will hold another strike if the hearing on MBC is not conducted.
Meanwhile, the DUP has announced a proposal on revision of the labor laws which include a number of pro-labor bills.
[Table 1] Main Features of Labor Law Revision Bills of the DUP
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Labor Standards Act
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･ Prohibit indirect employment except for the cases stipulated in the law
･ Regard indirect employment violating the law as direct employment
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Trade Union Act
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･ Extend the scope of workers and employers
･ Abolish the time-off system and the unified bargaining
channels system
･ Restrict employers’ right to terminate collective agreements and lock-outs
･ Limit the intervention of administrative offices in trade unions
･ Prohibit employers’ unfair discrimination among trade
unions
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Employment Security Act
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･ Strengthen the protection of workers in case of unlicensed labor supply services
‧ Consider direct employment in case of illegal supply of labor
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Special Act on the Promotion of Youth Employment
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･ Introduce a mandatory employment quota for youth:
– Public sector: 3%
– Private sector: 3% for companies with 300 employees or average sales of 100 billion won during the last 3 years
‧ Impose fine for failure to meet the youth employment quota
･ Extend the valid period (to 2017)
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2. Government re-attempts to reduce working hours
The Ministry of Employment & Labor (MOEL) has decided to push forward with the legislation on work hour reduction, which has been delayed due to different views among government branches and opposition from business. The MOEL plans to promote the need to reduce working hours and provide gradual measures based on company size during the Law Deliberation Subcommittee under the Environment & Labor Committee. The MOEL hopes to finalize the legislation on work hour reduction by the end of this year. However, the MOEL is expected to face many challenges as various government offices still have differences over the work hour reduction.
[Table 2] Main Features of the Work Hour Reduction Bill
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․ Include work on holidays and weekends in overtime work
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– Apply in stages, depending on company size (companies with more than 1,000 employees ⇒ apply from January 2014)
– Exception: If workloads increase temporarily, workers may work up to 20 hours per week overtime (working overtime for more than 12 consecutive days is not allowed and overtime work should not exceed 13 weeks per year).
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․ Extend the unit of flexible working hours
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– Current 2-week unit ⇒ extend to 1 month
※ For 1-month unit, the work hours should not exceed 48 hours per week (same as current 2-week unit)
– Current 3-month unit ⇒ extend to 1 year
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․ Shorter than 3-month unit: working hours should not exceed 12 hours per day
․ Longer than 3-month unit: working hours should not exceed 10 hours per day
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․ Reduce the number of sectors exempted from working hour limits
(26 sectors ⇒ 10 sectors)
※ The public interest members’ proposal on ‘limiting the reason for hiring’, ‘setting limits for overtime hours’ not included.
․ Grant day-off in return for overtime work
– Day-off should be granted to workers who have worked overtime or have not used their annual leave. (sign an agreement with workers’ representative)
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