Definitions in pro-labor bill ambiguous; Employer defenses should be built up

An amendment to Articles 2 and 3 of the Trade Union and Labor Relations Adjustment Act, widely known as the "Yellow Envelope" bill, passed the plenary session of the National Assembly on Sunday.

Not only Korean companies, but also foreign companies invested in Korea requested reconsideration of the pro-labor bill, but the ruling Democratic Party of Korea railroaded through its passage. Businesses had demanded a one-year grace period, but that was halved to six months. The previous president vetoed the contentious bill twice amid concerns, but it has become a reality under a new administration.

Industries will not collapse immediately due to the bill, but significant fallout will be predictable. The party should take responsibility for the consequences.

The bill grants workers of a subcontractor the right to negotiate with the main contractor and also allows labor unions to go on strike against management decisions. It restricts companies' claims for damages from workers whose illegal strikes lead to losses or property destruction.

The Democratic Party said the bill is necessary for Korea to join the ranks of developed nations, but that is not the case. There is no parallel around the world that permits employees of a subcontractor to negotiate with the main contractor over their wages or working conditions. There is no restriction, either, in advanced economies, on a company's claim for damages.

Now that a bill that lessens labor worries about being sued for damages has been passed in a country where they sometimes occupy workplaces, strikes are certain to further increase.

It is urgent during the six-month grace period to draw up countermeasures to minimize the bill's ill effects.

First, the main contractor, which will have the obligation to negotiate with labor unions of subcontractors, must be specified. The bill defines it as "the person who can govern and determine working conditions substantially and specifically." If this is broadly applied, a car assembly company and a shipbuilding company, for example, will likely be mired in negotiations with the labor unions of their numerous subcontractors all year round. This will undermine their industrial competitiveness.

"Strikes" are too broadly defined. The bill cites "managerial decisions that affect working conditions." Almost all managerial decisions affect working conditions, so practically all management activities can be targeted by industrial action.

This practically tells the management that it had better get the labor union's consent on business decisions if it wants to avoid being caught in a strike. If a company's decision on facility investment, restructuring and relocation becomes the object of consent and strike, normal management will be impossible.

In clarifying definitions, the government and ruling party ought to reflect the opinions of the business community.

The bill tilts the already uneven playing field further to labor's advantage. In an effort to rectify it, the employer's right to defense must be strengthened by law. Above all, the occupation of a workplace ought to be outlawed. The employer must be allowed to hire substitute workers during a strike period.

If the bill is enforced as is without countermeasures to protect employers, companies will have no choice but to reduce subcontracts, increase automation and move operations abroad. These responses will eventually lead to job losses here.

Decent jobs for young people about to start out in their careers are already in short supply. The number of discouraged youth who just "rested" while not actively seeking employment reached 420,000, an all-time high, in July.

Yet, Kim Yong-beom, President Lee Jae Myung's chief secretary for policy, said that if companies leave the country because of the bill, we have only to revise the law then. It sounds irresponsible.

Side effects are in plain sight. There is no reason to leave them unfixed before the bill takes effect.


khnews@heraldcorp.com