1. Government to revive tripartite dialogue and boost employment rate
The government is trying to revive tripartite dialogue on pending labor issues after with the new Minister of Employment & Labor. The new Minister of Employment & Labor, Mr. Lee Ki-kwon (who began July 2014), has shown a willingness to resolve some of these pending issues through tripartite dialogue in a meeting with the KEF leaders and a conference with the FKTU executives and representatives of industrial unions. In particular, the government has been trying to resolve these issues after the FKTU returned to the Tripartite Commission on August 19.
[Table 1] Discussion on Agenda Items during the Tripartite Commission Meeting
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Committee
(Number of meetings)
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Details of Discussion
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Committee on Public Sector Development (4)
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Labor-management cooperation in public institutions, innovation of public sector
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Committee on Occupational Safety Innovation (5)
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Improvement of safety management systems at industrial sites, plans for settlement of safety culture
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Special Committee on Labor Market Structure Improvements (2)
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Innovation of labor market structure including issues of wages and working hours
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The government is also focusing on job creation through improvement of the relationship between primary contractors and subcontractors, expansion of part-time employment and employment of the middle-aged in order to achieve its target of 70% employment. The Ministry of Employment & Labor (MOEL) held meetings with major businesses to call for improvements to working conditions for non-regular workers and push contractors to share more of the benefits with their subcontractors through the building up of a new “employment ecosystem”.
[Table 2] Government’s Regular Meetings by Business Type
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Type of business
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Points of Discussion
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Retailing
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Improve employment policies (minimum wage, working hours) in retailing industry
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Manufacturing (SMEs)
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Alleviate burden on SMEs related to reduction of working hours
|
|
Software
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Training for software industry professionals
(Work-based learning system)
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|
Shipbuilding & Steel
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Strengthen management of safety at partner firms, prohibit multi-layered subcontracting
|
|
Franchises
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Comply with minimum wage requirements, improve working conditions for non-regular workers
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The government conducted active labor inspections to counter criticism that the expansion of part-time employment is an expansion of low quality jobs. During August and September, 4,000 workplaces employing many part-time workers were inspected for compliance with written employment contracts and minimum wage.
The government also plans to announce comprehensive measures for non-regular employment* including prohibition of the use of non-regular workers for safety-related work, and contract splitting with non-regular workers.
* Details of comprehensive measures for non-regular employment: ∆prohibit the use of non-regular workers for safety-related work, ∆convert non-regular workers to regular employment at SMEs, ∆convert non-regular workers to regular employment in the public sector in phases, ∆expand support for part-time employment, ∆strengthen support for temporary and daily workers.
2. Supreme Court rules Ssangyong Motor layoffs as legal
On 3 November, the Supreme Court quashed the original ruling and returned it to the Seoul High Court, by confirming the legality of dismissing 153 redundant workers at Ssangyong Motor in 2009. This indicates that the Supreme Court recognized the company’s efforts to avoid dismissal and the urgent managerial need for the layoffs, something the Seoul High Court denied.
In its statement, the Supreme Court ruled, “An employer’s reasonable managerial decisions on the optimal number of workers for operating an enterprise should be respected.”
With respect to legitimacy of managerial dismissal cases, lower courts tend to judge based on the reasons that dismissal is not attributable to worker(s), exacerbating economic suffering of workers and the ripple effect on society (Seoul High Court rulings on Ssangyong Motor and Poongsan Microtech). This time, the Supreme Court has re-confirmed a relatively wide range of urgent managerial need. The Supreme Court had previously overturned the lower court judgment in the Cort Tech managerial dismissal case where the argument of urgent managerial need was denied and confirmed the dismissals as fair (Supreme Court 23 September 2012, 2010Da3629).
This ruling of the Supreme Court on the legality of the 2009 managerial dismissals by Ssangyong Motor will have a positive influence on related cases that are still pending *.
* Litigation by 10 dismissed workers (including Ssangyong Motor union branch president Han Sang-gyun) to nullify their dismissals
– Dismissal for justifiable reasons except for one person who was dismissed for his minor role in the strikes (Seoul High Court)
Ssangyong Motor and the police filed a suit for damages against the union and its members.
– Compensation of KRW 3.3 billion (USD 2.9 million) of the claimed KRW 10 billion (USD 9 million) (by the Suwon Regional Court, Pyeongtaek Branch)
However, despite the position taken by the Supreme Court, the possibility exists that demands to increase the requirements for managerial dismissal to be considered legitimate may gather momentum with support by opposition parties. A revision bill increasing the requirement of managerial dismissal from “urgent managerial need” to “urgent managerial need due to serious management difficulties which threaten to close down business” is pending in the Environment & Labor Committee (proposed by both the ruling and opposition parties).