Labor Trends

1. Overview

Government labor policy and political affairs of labor groups, rather than company-level disputes, are expected to be the main labor management issues for the 2nd half of 2011

As major bargaining agreements at the large company- and industry-level are entering the final stages, labor groups are expected to focus on support for trade unions in workplaces with long-term labor disputes, and increase their own political activity in Q4.

Labor groups are working hard to strengthen their political influence in preparation for political events such as parliamentary inspections and upcoming elections. Seoul’s mayoral election will be first, followed by general elections in April, and presidential election in December 2012.

【Picture1】 Major activities by labor groups

During parliamentary inspections, labor groups are planning to bring attention to companies with long-term labor disputes and companies without unions, while focusing on non-regular workers, in-house subcontract workers, and revision of the Trade Union Act during regular sessions of the National Assembly. Of particular note is that the ruling party and opposition parties are unfolding pro-labor campaigns, signifying a shift by the Grand National Party from its original conservative standpoint.

Nine entrepreneurs were appointed as witnesses for parliamentary inspection of the Environment & Labor Committee. Opposition parties are demanding more entrepreneurs from companies such as Samsung or Hyundai Motors be appointed as witnesses. Many other entrepreneurs were appointed in other committees such as the Knowledge Economy Committee and National Policy Committee. Meanwhile, during regular session of the National Assembly, the Grand National Party and the opposition parties are expected to push ahead with legislation on non-regular workers and the Act on Prohibition of Discrimination Based on Academic Background.
The KEF is doing its best to check the advance of these pro-labor activities being promoted in political circles, by issuing statements and advocating for businesses at the National Assembly. But in order to respond effectively, stronger co-operation between businesses across all sectors is necessary. Meanwhile, as the Multiple Trade Union system is introduced, the KCTU is beginning to restore its activities of supporting industry-level unions and bargaining. This may cause the number of disputes to increase in 2012.

2. Labor groups seek to strengthen their influence during regular sessions of the National Assembly

Labor groups are planning to continue the struggle for further revision of the Trade Union Act, as well as other political issues, with the government and Grand National Party during regular National Assembly sessions. Parliamentary inspections and problems related to creation of legislation and the budget are expected to be issues for this coming session. While opposition parties and labor groups are planning to raise the issue of long-term labor disputes and massive layoffs from companies, the intensity of labor strife is expected to be weakened than ordinary years.

【Table 1】 Dates for Inspection of Labor-related Institutions

For instance, labor groups are likely to hold rallies by sector-based alliance rather than at the central level with the aim of reflecting their demands during the parliamentary inspections; Korean Financial Industry Union (Standard Chartered First Bank), Korean Federation of Private Service Workers Union (Lotte), Korean Metal Workers Union (Daewoo Motor Sales etc). As for the number of allies, only 2 rallies (Sept 23, Oct 6~7) are expected to be held by the Metal Workers Union.

Meanwhile, legislation and budgeting during regular sessions of the National Assembly may result in unfavorable conditions for business. This is due to pro-labor movement from politicians looking towards the general and presidential elections. Labor-friendly legislation is expected particularly in areas such as non-regular employment, in-house subcontracting and work-family balance as politicians seek to win support from voters affected by these issues. As for budgeting, demands from the umbrella unions (the FKTU and KCTU) for salary increases for new employees in the public-sector is expected to be an influencing factor.

3. Increasing political influence of labor groups

As political circles are warming up for the elections, labor-friendly policy suggestions and strengthening relations between labor and politicians are expected in the 4th quarter of 2011. Both umbrella unions have put more emphasis on political activity beginning from 2nd half of 2011.

The FKTU is likely to finalize their plans for political coalition in a distinctive manner for the upcoming election with the aim of strengthening coalition with the existing party. For the general elections, FKTU finalized only a broad principle of support for labor-friendly parties rather than supporting a particular party, and has plans to partially empower industry level unions and regional branches. The FKTU is planning to finalize its strategies for Seoul’s mayoral election (Oct 26) at the Central Politics Committee on Sept 29.

The KCTU’s focus is amalgamation of the Democratic Labor Party (DLP) with the New Progressive Party (NPP) and the Participation Party into a ‘New Unified Progressive Party’. Although the proposal to unify the parties was rejected at the special party conference (Sept 4) by the New Progressive Party, the KCTU continues to seek this amalgamation with the DLP.

By establishing a New Unified Progressive Party, the KCTU is seeking to win a number of seats in the upcoming general elections. Through this effort, the New Unified Progressive Party would seek coalition with the Democratic Party for the presidential election. As a member of a combined government, the KCTU is planning to place 1 or 2 personnel as Ministers in the next administration.

Moreover, the politicians are seeking to strengthen coalition with labor groups to win a majority vote at the general and presidential elections.

Political circles are expected to continue on a labor-friendly path which will include legislation of labor-friendly policies, nomination of former labor group personnel for general elections, placement of labor personnel on a preparatory team for the elections and resolution of pending labor issues favorable to labor groups.