[Q&A] Will the Controversial Yellow Envelope Act Reach the Plenary Session This Time?

2014 Court Ruling on Ssangyong Motor Begins
Possibility of Direct Referral to Plenary Session in May↑
Ruling Party Likely to Exercise Veto... Constitutional Court Card Also Considered

As the 'Yellow Envelope Act' is expected to proceed to direct plenary session referral in the May extraordinary session of the National Assembly, it appears to be entering the final legislative stage after eight years since its proposal. The Democratic Party, which first proposed this bill in the 19th National Assembly in 2015, has passed the Yellow Envelope Act solely in the standing committee and is now aiming for direct referral to the plenary session. The People Power Party opposes it, along with the business community, calling the Yellow Envelope Act a 'law that encourages illegal strikes.'

There is a prospect that the Yellow Envelope Act could be directly referred to the plenary session at the first full meeting in May, if Jeon Hae-cheol, the chairman of the Environment and Labor Committee and a Democratic Party member, makes a decision. Last month, Chairman Jeon delayed the decision on direct referral at the full committee meeting of the Environment and Labor Committee, stating, "It will be decided through consultation between the party floor leaders. If the review does not proceed in the Legislation and Judiciary Committee, necessary measures will be taken at the next meeting according to the National Assembly Act," applying pressure. Accordingly, if the Environment and Labor Committee follows the direct referral procedure at its next full meeting, the Yellow Envelope Act could be submitted to the plenary session in June after a 30-day reflection period.

Im I-ja, a member of the People Power Party, is requesting a procedural speech from Chairman Jeon Hae-cheol before the submission of the amendment to Articles 2 and 3 of the Labor Union Act, known as the "Yellow Envelope Act," at the Environment and Labor Committee plenary meeting held at the National Assembly in Yeouido, Seoul on February 21. Photo by Kim Hyun-min kimhyun81@

Q. Where did the 'Yellow Envelope Act' begin?

-What process did the Yellow Envelope Act go through when it was first proposed?

▲It began with the Ssangyong Motor incident in 2014. At that time, the court ruled that Ssangyong Motor and the police had to pay approximately 4.7 billion won in damages in a lawsuit filed against striking workers. A citizen delivered a yellow envelope containing '47,000 won' to the weekly magazine Sisain, which led to the Yellow Envelope campaign to help workers struggling due to the damage compensation ruling.

The New Politics Alliance for Democracy, the predecessor of the Democratic Party, first proposed the Yellow Envelope Act in the 19th National Assembly in 2015. The bill aimed to expand the scope of 'legal strikes' exempt from damage compensation arising from strikes and to set limits on damage claims based on union size. However, the bill was automatically discarded due to the expiration of the National Assembly session after only two subcommittee reviews. Although related bills were proposed again during the 20th National Assembly when the Democratic Party was the ruling party, discussions stalled and the bills disappeared with the end of the Assembly's term.

In the 21st National Assembly, the Yellow Envelope Act was reintroduced with a total of 11 bills: eight from the Democratic Party, one from independent lawmaker Yoon Mi-hyang (formerly of the Democratic Party), and two from the Justice Party. These bills were consolidated into a single alternative after passing the full meeting of the Environment and Labor Committee on February 21.

-What are the main contents of the Yellow Envelope Act?

▲The formal legal name of the Yellow Envelope Act is the 'Partial Amendment to the Labor Union and Labor Relations Adjustment Act,' which amends Articles 2 and 3 of the Labor Union Act. Article 2 defines employers and labor unions, among others. Article 3 specifies that damage claims cannot be made against labor unions or workers for damages caused by collective bargaining or strike actions under this law.

The core of the Yellow Envelope Act passed by the Environment and Labor Committee consists of two points. The first is the 'expansion of the employer scope.' Even if not a party to the labor contract, those who have a position to substantially and concretely control and determine workers' working conditions?such as the primary contractor?will be recognized as employers. According to this provision, subcontracted workers can demand negotiations with the primary contractor if the condition of substantial control over working conditions is met.

The second is the provision limiting damage claims related to labor disputes, which forms the basis of the Yellow Envelope Act. Previously, in cases of joint illegal strikes, all parties were held collectively responsible. Going forward, the scope of responsibility will be determined individually based on each liable party's fault and contribution. In the same context, a 'guarantor' who guarantees the identity of the employee at hiring is exempted from damage liability arising from collective bargaining, strike actions, or other union activities.

The scope of labor disputes has also been expanded from matters concerning 'determination of working conditions' under current law to matters concerning 'working conditions.' With this expansion, strike actions, which were previously limited to disputes over benefits such as wages, will now encompass disputes over rights such as 'working conditions.'

Q. What were the issues in the 21st National Assembly?

-Why was the bill, which was discarded in the previous Assembly, reignited in the 21st National Assembly?

▲The trigger was the subcontractor union strike at Daewoo Shipbuilding & Marine Engineering. In August last year, Daewoo Shipbuilding & Marine Engineering filed damage claims of about 47 billion won against five members of the subcontractor union's executive committee, reigniting calls to prevent excessive damage claims through the enactment of the Yellow Envelope Act. The Justice Party proposed the bill in September last year and adopted it as a party policy, and the Democratic Party included the Yellow Envelope Act among its seven legislative tasks.

The ruling recognizing the employer status of the primary contractor over subcontracted workers in the CJ Logistics case also had a significant impact on discussions about the Yellow Envelope Act. On January 12, the Seoul Administrative Court ruled that CJ Logistics, the primary contractor, committed an unfair labor practice by refusing collective bargaining with delivery workers, issuing a ruling consistent with the intent of the Yellow Envelope Act. As the court accepted the Central Labor Relations Commission's decision, voices calling for legislative clarification of labor-management legal battles gained momentum. Prior to this, the Supreme Court's judgment on the 2010 Hyundai Heavy Industries case also exists. The Supreme Court ruled that if the primary contractor substantially and concretely controls and determines workers' basic working conditions, the primary contractor can be regarded as the employer.

-What are the positions of the ruling and opposition parties?

▲The ruling and opposition parties sharply oppose each other, calling the Yellow Envelope Act a 'law that encourages illegal strikes' and a 'law that guarantees legal strikes,' respectively. The opposition argues that the Yellow Envelope Act is a measure to properly guarantee labor rights. On May 1, Labor Day, Lee Eun-joo, floor leader of the Justice Party, held a press conference with the Korean Confederation of Trade Unions in front of the Yongsan Presidential Office, stating, "Hundreds of billions and tens of billions of won in damage claims and seizures repeated during disputes threaten the freedom of association, a fundamental right in a democratic country, and workers continue to commit suicide in this labor backward country," emphasizing, "The Yellow Envelope Act passed by the Environment and Labor Committee last time is the minimum measure to prevent such tragedies, promote peace in industrial sites, and protect workers' rights to unionize, a standard of civilized countries."

The government and ruling party oppose the Yellow Envelope Act, arguing that it infringes on citizens' property rights and undermines judicial justice. They claim that by expanding the scope of legal strikes and exempting union members from damage claims, the act could grant impunity even for clear illegal acts. They also point out the difficulty of applying the Yellow Envelope Act in reality, where subcontracted workers negotiate with the primary contractor. On April 25, Kim Hyung-dong, a People Power Party lawmaker, explained at the Environment and Labor Committee full meeting that within the Hyundai Motor Group alone, there are thousands of companies including Hyundai Mobis and other subcontractors, making it impossible to unify negotiation channels, emphasizing, "If Articles 2 and 3 of the Labor Union Act (Yellow Envelope Act) pass now, there will be considerable confusion on the ground."

-If the Yellow Envelope Act is directly referred to the plenary session, can it be considered enacted soon?

▲Not necessarily. First, the ruling party has hinted at the president's right to request reconsideration (veto). On April 18, Kim Ki-hyun, leader of the People Power Party, met with business leaders including Sohn Kyung-shik, chairman of the Korea Employers Federation, saying, "One of the things we are very concerned about is the Yellow Envelope Act," and "Our party is firmly against its passage." On May 1, floor leader Yoon Jae-ok said at the Supreme Council meeting, "The Democratic Party and Justice Party should immediately withdraw bills like the Yellow Envelope Act that protect the vested interests of powerful unions and burden our economy while only watching the big unions."

There is also open talk that the ruling party might block direct referral to the plenary session through a constitutional court jurisdictional dispute petition. Previously, People Power Party lawmakers in the Legislation and Judiciary Committee visited the Constitutional Court's civil affairs office on April 14 to submit a jurisdictional dispute petition and request a provisional suspension of enforcement regarding the direct referral of the Broadcasting Act amendment bill to the plenary session. The People Power Party lawmakers argued that the Broadcasting Act was still under discussion in the Legislation and Judiciary Committee's second subcommittee and that, unlike Article 86(3) of the National Assembly Act, 60 days had passed 'with reason.' Article 86(3) of the National Assembly Act states that direct referral is justified "when the Legislation and Judiciary Committee fails to complete the review of a bill referred to it within 60 days without reason."

Im Eui-ja, the People Power Party floor leader in the Environment and Labor Committee, also pointed out this issue. On April 25, at the party's floor strategy meeting, she referred to the relevant clause of the National Assembly Act, saying, "On March 27, a fierce debate over pros and cons lasted about two and a half hours in the Legislation and Judiciary Committee, and Chairman Kim Do-eup said he would invite the Court Administration Office, the expert department on legal systems, to the next full meeting for discussion," adding, "Directly referring a law that encourages illegal strikes, which is being fiercely debated in the Legislation and Judiciary Committee, to the plenary session just because 60 days have passed looks like the Democratic Party is trying to shift the focus due to the money envelope gate scandal." The Yellow Envelope Act was submitted to the Legislation and Judiciary Committee full meeting on March 27, before 60 days had passed since its referral.

A People Power Party official said, "(The Broadcasting Act petition) is seen as an attempt to block bills like the Yellow Envelope Act and the Safe Freight Rate System," adding, "How the Constitutional Court rules on this case will determine how to handle other bills in the future."

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