Economic Sector "Labor Director System Passes National Assembly Agenda Coordination Committee, Concerns Over Side Effects"

[Asia Economy Reporter Changhwan Lee] Economic organizations expressed concerns on the 4th regarding the National Assembly's Strategy and Finance Committee holding a bill adjustment meeting and passing the "Amendment to the Act on the Management of Public Institutions," which mandates the introduction of the labor director system in public institutions.

The Korea Employers Federation, Korea Chamber of Commerce and Industry, Korea International Trade Association, Korea Federation of Small and Medium Business, and Korea Federation of Medium-sized Enterprises issued a joint statement on the same day, stating, "The business community has repeatedly emphasized that sufficient review of side effects and national consensus must precede the legislative promotion of the labor director system. However, we cannot help but express serious concerns that these requests have not been reflected at all, and the bill amendment process is being pushed forward forcefully."

They continued, "In South Korea's conflictual labor-management relations environment, the introduction of the labor director system in the public sector will deepen the imbalance of power in labor-management relations and further encourage the reckless management and moral hazard of public institutions."

In particular, they emphasized, "If the introduction of the labor director system in the public sector expands to private companies, it will distort the function of the board of directors and seriously undermine competitiveness by reducing the speed of management decision-making."

The economic organizations added, "Nevertheless, pushing forward the labor director system without sufficient discussion and national consensus is absolutely incomprehensible. The business community once again earnestly requests the National Assembly to halt further legislative procedures on this bill."

The public sector labor director system is a system where employee representatives of public institutions participate in the board of directors and exercise speaking and voting rights. Labor directors participating in the board can exercise speaking and voting rights to represent workers' interests.

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