Companies on the Brink... Unions Bringing About Their Own Cliff-Edge Crisis

Simultaneous Pressure on Labor Union Yellow Envelope Law and Serious Accident Punishment Act
"'3 High Crisis' Approaching... Additional Concerns Over Union Risks"

The Korean Confederation of Trade Unions held a rally near the National Assembly building in Yeouido, Seoul, on the 6th, urging the revision of Articles 2 and 3 of the Trade Union Act and the guarantee of the Basic Labor Law. / Photo by Mun Ho-nam munonam@

[Asia Economy Reporter Kiho Sung] The two major labor unions are exerting all-around pressure on the government, political circles, and companies, spearheading the so-called Yellow Envelope Act (amendments to Articles 2 and 3 of the Labor Union Act) and the Serious Accident Punishment Act. Domestic large corporations are facing an unpredictable situation where it is difficult to establish management plans for next year, and with the growing union risks, the sense of crisis is intensifying. In particular, amid a clear consumption contraction due to the economic recession and the simultaneous onslaught of the 'three highs (high inflation, high interest rates, and high exchange rates)' crisis, concerns are being raised that union pressure could rather trigger an economic crisis.

According to political and labor sources on the 19th, the Korean Confederation of Trade Unions (KCTU) plans to hold a press conference in front of the National Assembly to urge the amendment of Articles 2 and 3 of the Labor Union Act.

Previously, on the day before, the KCTU and People's Solidarity for Participatory Democracy held a press conference to announce the bill of the Task Force for the Amendment of Articles 2 and 3 of the Labor Union Act, which they had finalized. The Task Force will hold two discussion sessions at the National Assembly on the 25th and November 2nd regarding the bill introduced that day. Starting in November, they plan to promote legislative proposals through lawmakers who share the intention to amend Articles 2 and 3 of the Labor Union Act, along with a national consent petition.

The KCTU also plans to escalate its pressure. They intend to conduct a sit-in in front of the National Assembly until December 8, while also participating in promotional campaigns during commuting and lunch hours, meetings with lawmakers, and the Task Force’s Wednesday candlelight cultural events.

The business community is responding with discomfort to the union’s pressure. In a situation where it is difficult to foresee even a step ahead, such union pressure only exacerbates difficulties. A representative from a major corporation said, "Due to the uncertain economic situation, it is not easy to establish next year’s management plan," adding, "There is concern that we may have to bear extreme union risks amid this."

Already, large corporations have entered a quasi-wartime management system, postponing or withdrawing investment plans. SK Hynix decided to put on hold the M17 plant scheduled to be constructed in Cheongju, citing uncertainty in the semiconductor market. Hyundai Oilbank halted the expansion of crude oil refining facilities and vacuum distillation equipment at its Seosan plant after investing 360 billion won.

Companies are also concerned about the Serious Accident Punishment Act. The two major unions held a press conference at the National Assembly the day before, urging the Ministry of Employment and Labor to improve its industrial safety and health supervisory administration for workers’ lives and safety. They referred to the recent fatal accident involving a worker caught in machinery at an SPC-affiliated bakery factory and demanded immediate special inspections of workplaces where serious accidents have occurred.

The business community has been continuously requesting revisions to the Serious Accident Punishment Act. The Korea Employers Federation (KEF) stated at the 'Serious Accident Prevention and Industrial Safety' forum held last month that excessive penalty provisions in the related law need to be improved. Lee Dong-geun, KEF Vice Chairman, emphasized, "It has been eight months since the Serious Accident Punishment Act was implemented, but there has been no clear effect in reducing accidents yet," adding, "The new government is currently working on revising enforcement decrees to reduce uncertainties in the Act and establishing a 'Serious Accident Reduction Roadmap' aimed at building a corporate autonomous safety management system. We hope policies reflecting the voices from industrial sites will be established."

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