[Editorial] Caving In to Labor Pressure

The tripartite panel of labor, management and the government has agreed to end the long-standing practice of employers paying wages to full-time union members. The political circle, however, is showing signs of retreating and caving in to pressure from the labor community. Businesses are also angry, saying the ruling Grand National Party’s proposal to include regular union management work under the “time-off” system will make it legal for companies to pay wages to full-time unionists. If the law banning wages for full-time unionists and allowing multiple unions at one workplace is implemented in January without revision or addition, the domestic labor market will fall into chaos.

The law banning wages for full-time unionists was enacted in 1997 but its implementation has been postponed until the end of this year. The amount companies paid to full-time union staff rose 32 percent from 324.3 billion won (275.5 million U.S. dollars) in 2005 to 428.8 billion won (364.3 million U.S. dollars) last year. The payments themselves are a huge burden on businesses. In addition, the militant activities of full-time unionists undermine corporate competitiveness. They have plenty of time because they do not work at production sites, so they make labor movements a political struggle.

The panel agreed Dec. 4 to ban wages for full-time union members from July next year after a six-month grace period, during which employers will give them an “appropriate” level of time-off work. The agreement was realistic in that it seeks to reduce the excessive number of full-time union members while not discouraging union activities. Giving a 30-month grace period before allowing multiple unions at one workplace was also inevitable.

The ruling party, however, came up with a revised proposal to recognize “regular union management work” as time-off work, bowing to pressure from the Federation of Korean Trade Unions, an umbrella union that backed Lee Myung-bak in his presidential election campaign. If implemented, the proposal will prompt some 1,100 unions without full-time members to turn confrontational because they could think it unwise not to have full-time union members paid.

The federation took a step forward and proposed that the National Assembly require employers to pay wages to union members engaged in activities led by umbrella labor organizations or for training. It also urged the removal of a clause on punishing employers who pay wages above the legal standard. These are cheeky proposals. The best thing is to keep the tripartite agreement and introduce specific standards set by the International Labor Organizations in consideration of Korea’s labor situation.

The heads of the five major business lobbying groups, including Sohn Kyung-sik of the Korea Chamber of Commerce and Industry, asked Knowledge Economy Minister Choi Kyung-hwan Saturday to make the law in accordance with the agreement. Sohn said the ruling party’s renewed proposal is equivalent to requiring employers to pay wages to full-time union members in violation of the agreement. The other four groups issued a statement Dec. 10 in protest of the ruling party’s proposal.

Choo Mi-ae, chairwoman of the National Assembly’s environment and labor committee and a member of the main opposition Democratic Party, fanned uncertainty over the law when she suggested holding “multilateral” talks with labor, management, politicians and the government this Tuesday. Though she said the dialogue will seek to reach a consensus, the opposition party will likely try to reflect more opinions of the Korea Confederation of Trade Unions, which did not participate in the tripartite talks. Both the ruling and opposition parties have become prisoners of the two major labor organizations and are on the verge of losing a rare opportunity to enhance national competitiveness and solidify economic growth.

Umbrella trade organizations have instructed member unions to seek through collective bargaining a guarantee on wages for full-time union members. This move is illegal under the original tripartite agreement. Considering the ruling party’s proposed revision, fear is rising over how many small and medium businesses will face unreasonable demands from their unions.

The political circle must be clearly aware that the proposed time-off system is meant to ban wages for full-time unionists, not to guarantee pay for them. A lesson needs to be learned from other countries where multiple unions at one workplace disrupt industrial peace and undermine corporate competitiveness.

If the proposed revision of the law ends up becoming a hodgepodge of demands from the two umbrella labor groups or the law takes effect without proper preparation, it will disturb corporate management and ultimately deal a blow to the Korean economy.

The Korean economy is at a crossroads between the road to recovery and slipping back into recession. If the union law is revised in the wrong direction and fuels militant labor strife, the economy could face a bad scenario. Such an event will run counter to the wishes of many workers who want labor stability, and severely hurt younger people entering the labor market by weakening the ability of companies to create jobs.

There is little time left before the year-end deadline for the labor law revision. Politicians should hurry up revising the law in accordance with the hard-earned tripartite agreement.