Daewoo Shipbuilding Announces 47 Billion Won Compensation Lawsuit... National Assembly Pushes Legislation for 'Yellow Envelope Act'

Daewoo Shipbuilding "Strike Losses Are Large... Decision Based on Principles"
Labor Unions Protest "A Plan to Eradicate Labor Basic Rights and Livelihood Rights"
Political Circles Clash Over Compensation Lawsuits... Four Related Bills Proposed

[Asia Economy Reporter Choi Seoyoon] Daewoo Shipbuilding & Marine Engineering (DSME) plans to file a 47 billion KRW damages lawsuit against the subcontractor union executive committee as early as the 26th. This is to hold them accountable for production disruptions and resulting sales losses caused by the union's month-long occupation protest. The union side has opposed the claim, saying, "We live paycheck to paycheck, so this amount is absurd." Meanwhile, the so-called 'Yellow Envelope Act,' which limits damages lawsuits against unions, is being pushed in the National Assembly, reigniting the conflict between DSME and its subcontractor labor union.

On the 25th, a DSME official stated, "In principle, we plan to file a damages lawsuit worth 47 billion KRW against the subcontractor union executive committee within this week." He added, "The losses due to the strike amount to about 800 billion KRW, but as work has resumed, the sales decline is gradually decreasing. The claim amount was calculated considering fixed cost losses excluding the sales decrease." This is the largest damages claim ever filed against workers.

The labor community strongly opposed the move, calling it "a measure to destroy the basic labor rights and livelihood of non-regular workers." The Korean Confederation of Trade Unions (KCTU) Gyeongnam branch issued a statement immediately after the lawsuit news broke, saying, "DSME did not take any responsible role during the struggle and worsened the situation by inciting conflicts between unions. If they have no responsibility for employment, they should bear the losses themselves."

Minister of Employment and Labor Lee Jeong-sik is responding to lawmakers' questions at the Environment and Labor Committee plenary meeting held at the National Assembly in Yeouido, Seoul, on the 3rd.
[Image source=Yonhap News]

The conflict between DSME and its subcontractor labor union is spreading to the political arena. On the 3rd, ruling and opposition parties clashed over DSME's damages lawsuit move during the National Assembly Environment and Labor Committee plenary session. Ruling party lawmakers argued that firm measures should be taken against illegal strikes, while opposition lawmakers countered that imposing hundreds of billions in damages on workers for strikes that are difficult to justify would destroy the unions.

Currently, four bills known as the 'Yellow Envelope Act (Amendment to the Labor Union and Labor Relations Adjustment Act)' are pending in the National Assembly. The bills aim to restrict employers from filing damages lawsuits or executing provisional seizures for losses caused by union strikes. The bills were respectively proposed by Democratic Party lawmakers Kang Byung-won, Lim Jong-sung, Lee Soo-jin, and Justice Party lawmaker Kang Eun-mi. The name originates from 2014 when workers involved in the Ssangyong Motor strike were ordered by the court to pay 4.7 billion KRW in damages, and civic groups sent donations in yellow envelopes to support them. Similar bills were proposed in the 19th and 20th National Assemblies but were discarded due to term expiration.

Meanwhile, the DSME subcontractor union began an indefinite hunger strike in front of the National Assembly on the 18th. They claim that the company is not honoring the 'employment guarantee for union members of closed companies' agreed upon during collective bargaining. Kim Hyung-soo, head of the Metal Workers' Union Geoje-Tongyeong-Goseong Shipbuilding Subcontractor Branch, said, "We discussed guaranteeing employment for 47 union members from four companies that closed before and after the strike, and the company said they were not worried about employment issues due to severe manpower shortages, agreeing to 'make the best effort.' This was confirmed by the primary contractor DSME as well, but there has been no progress even after a month."

On the 24th, in front of the National Assembly, Kim Hyung-su, chairman of the Metal Workers' Union Geoje·Tongyeong·Goseong Shipbuilding Subcontracting Branch, has been continuing a hunger strike for the seventh day, urging the implementation of the labor-management agreement on 'employment succession for union members of closed businesses.' Photo by Choi Seo-yoon

This content was produced with the assistance of AI translation services.