"Cutting Support for Unions Not Complying with Accounting Obligations... Reviewing Tax Credit"

Minister of Employment and Labor Lee Jeong-sik (center), Presidential Office Senior Secretary for Social Affairs Ahn Sang-hoon (right), and Senior Secretary for Public Relations Kim Eun-hye are holding a briefing on the disclosure of 'union accounting' at the Yongsan Presidential Office building in Seoul on the afternoon of the 20th. [Image source=Yonhap News]

On the 20th, Lee Jeong-sik, Minister of Employment and Labor, announced that labor unions failing to comply with accounting-related obligations will be completely excluded from government support projects, and the tax deduction system for union dues will be reconsidered from scratch.

Minister Lee made these remarks during a briefing held after reporting the union accounting transparency measures to President Yoon Seok-yeol on the same day.

Minister Lee emphasized, "First, we plan to strictly respond with a zero-tolerance policy to 207 unions that have not submitted the results of maintaining and preserving accounting books," adding, "We will immediately grant a 14-day correction period, and impose fines if not complied with."

For unions that continue to fail to report accounting data thereafter, on-site investigations will be conducted, and additional fines will be imposed if they refuse, obstruct, or evade these investigations.

Furthermore, starting this year, labor organizations that do not comply with accounting-related legal obligations will be excluded from government support projects, and all subsidies provided so far will be thoroughly investigated, with strict measures such as recovery imposed if fraud is detected.

In particular, even before the law is amended, the current 15% tax deduction for union dues will be reconsidered from the ground up for unions that do not submit accounting data, Minister Lee stressed.

Minister Lee explained, "We will also prepare legal and institutional improvement plans to regulate illegal and unfair acts by unions, and promote the modernization of labor laws in line with global standards," adding, "We will soon announce the legislative proposal for amendments to the Labor Standards Act related to working hours and promote fundamental institutional improvements across labor laws including dispatch through discussions at the Economic, Social and Labor Council (Gyeong-sa-no-wi)."

Earlier, to strengthen union accounting transparency, the government requested a total of 327 unit unions and federations with more than 1,000 members to submit accounting-related materials from the 1st to the 15th, but only 120 (36.7%) submitted materials as requested by the government.

The Korean Confederation of Trade Unions (Minju Nochong) held a press conference at its education center in Jung-gu, Seoul, on the same day, stating, "Minju Nochong publicly disclosed the operation results, business budget, and accounting audit results at the regular delegate conference and streamed the conference proceedings online," and criticized, "If you want to raise issues about Minju Nochong and its affiliated unions violating the Union Act, first present illegal evidence."

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