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S. Korea's increasing labour disputes

Publication Date : 17-07-2014

 

Concerns are growing that the sluggish Korean economy, struggling with slumping consumer spending and the steep appreciation of the won, may be further held back by increasing labour disputes in the months to come.

Thousands of unionized truckers across the country staged a one-day strike Monday, asking for the early passage of a bill designed to improve their working conditions. They threatened to go on a general strike unless their demand is met soon.

Most automakers are also facing the prospect of renewed labour strife amid unfavorable market conditions.

Union workers at a plant of Renault Samsung Motors Co., the local unit of French carmaker Renault S.A., halted work for two hours on Monday afternoon to put pressure on management after initial negotiations failed to bridge differences over wages, bonuses and fringe benefits. The move, which marked the first walkout at any local carmaker this year, is set to be followed by similar action by unionized employees of GM Korea Co., who voted last week to go on strike but have yet to announce a specific plan.

Labour and management at Hyundai Motor Co. and Kia Motors Corp., Korea’s two largest automakers, have made little headway in talks that started earlier this month. Any labour strife would hamper their efforts to regain market share from global rivals by introducing new models.

In a move that will further stiffen labour-management relations, the Korea Confederation of Trade Unions, the more militant of the nation’s two umbrella unions, is planning to stage a strike later this month in solidarity with a group of progressive teachers and educational workers.

As of the end of May, about 10 percent of companies had completed annual negotiations on wages and other working conditions, the lowest level since 1997, when the government began compiling related data. The figure raises concern that this year will see a sharp increase in the number of labour disputes. During the first six months of the year, 44 labour-management conflicts were reported, up 250 percent from the same period last year.

The growing tension at workplaces is threatening to end the relatively calm relations between workers and management that have prevailed since 2011, when longstanding conflicts were settled over the introduction of time-off and multiple union systems. The impasse in this year’s labour-management negotiations is attributed to difficulties in reaching a compromise on a set of thorny issues such as the scope of ordinary wages, cutback in working hours and extension of the retirement age.

Rekindled labour strife must be avoided for the sake of the slumping economy. It would deal a severe blow to efforts President Park Geun-hye’s administration is poised to make to reverse the economic downturn.

Park said Monday that the top priority should be reviving the economy under a new Cabinet to be launched this week. Under her direction, the incoming economic ministers should be quick to implement a full range of policies to reinvigorate the economy. But they need to be equally attentive to preventing labour strife from destabilizing the foundation of industrial and business activity.

Over the past years, the government has largely maintained a stance of nonintervention to enable companies and their trade unions to settle disputes on their own in a concerted manner. But the current situation, in which labour and management stand apart over a set of sensitive matters hard to reach consensus on, members of the administration need to come forward to assume a coordinating role. The new minister of employment and labour should immediately begin dialogue with labour representatives. The tripartite commission of labour, management and the government, which has remained languid in recent years, should be reactivated to help work out harmonious solutions.

 

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