How’s Life in Korea? Not good for workers & their trade unions!

South Korea is to celebrate 20 years of OECD membership at the Ministerial in June. Celebrations that come with a bitter taste for Korean trade unions.

Since 11 December 2015, Han Sang-gyun, president of the Korean Confederation of Trade Unions (KCTU) is in jail. He has a right to a 10mn-visit per day at the Seoul Detention Centre (a bit less in fact). The KCTU is one of the TUAC Korean affiliates alongside the Federation of Korean Trade Unions (FKTU). Han Sang-gyun is accused of “obstruction of traffic” during demonstrations held in 2015 to commemorate the tragedy of the Sewol Ferry. He could face up to 10 years in prison. His trial started last Monday. He is not alone at the Seoul Detention Centre. 74 trade unionists are imprisoned in Korea, including 15 KCTU officials, 504 other KCTU members have been summoned. The offices of the KCTU and its affiliates, including the teachers’ KTU have been raided.

Meanwhile, the relations between the government and the other Korean central, the FKTU, are broken down. For FKTU President Kim Dong-man “There’s no point in sitting down to talk with a government that makes a practice of breaking its promises and violating its agreements”.

Repression is hitting KCTU front on. Dialogue is broken with the FKTU. Welcome to Korea.

Trade union repression and labour right violation in South Korea is an old issue. At the ILO, Korea is subject to the longest running case of the Committee on Freedom of Association: n°1865 submitted on 14 December 1995. Korea joined the OECD in 1996 upon the commitment to reform its labour law “in line with internationally accepted standards, including those concerning basic rights such as freedom of association and collective bargaining”. The “special monitoring process” that was set up by the OECD as part of the accession process proved to be an effective mechanism to hold Korean public authorities to account. It was ended in 2007.

Twenty years after its accession, and ten years after the end of the monitoring process, Korea is still far from having fulfilled its commitment to the OECD to bring its labour law in line with international standards. In the past three years, repression against unions and the criminalisation of their activities have made a comeback as a government practice.

  • Freedom of Assembly: the legal basis for the repression against KCTU leaders is the Criminal Act art. 185 on “General Obstruction of Traffic” which has become the main instrument to deter and ban freedom of assembly since 2008 according to a coalition of lawyers’ associations and NGOs. “A fundamental problem” for Maina Kiai, UN Special Rapporteur, “is the fact that assemblies are deemed to be “unlawful” unless organizers notify the authorities in advance […] Organizers of peaceful assemblies should not be held liable, under any circumstances, for the criminal actions of others”.
  • The right to strike is severely restricted by excessive notification and legal requirements and by Criminal Act Art.314 on “obstruction of business” which can be used to oppose and sue trade union officers that engage in a strike.
  • Freedom of Association: the right to join a trade union of one’s own choosing and independent from management is impeded by a “unitary bargain” system which excludes minority trade unions from the process and the increased opportunities for management to create “bogus unions” for the sole purpose of impeding the presence of industry-wide (independent) trade unions.
  • Restrictions applying to the public sector: the denial of civil servants’ right to organise and join a union as a result of a broad definition of “essential public services”, where strike action is prohibited or severely restricted.
  • State interference: authorities can arbitrarily dissolve or suspend a trade union, most often on the ground of a prohibition for unemployed or dismissed workers to be a member of a trade union. The teachers’ KTU and the public sector KGEU were decertified on these grounds.

At face value, the Korean economy is doing well. The Chaebols — the Korean conglomerates — are highly integrated in the global economy. They have household names across the globe: Samsung, Hyundai Motors, LG, etc. According to the OECD, “Korea has the highest share of foreign content of exports in 2011 in all G20 countries (41.6%)”. At face value, the labour market is also doing as well. The official unemployment rate is close to pre-2008 levels at 3.7%. Employment rate is on the rise.

But once you scratch the surface, the figures suggest a different reality. Inequality is rising. Women and the youth are under-represented, if not marginalised in the labour market. Overall, “non-regular” workers — low-paid, short term contract, limited or no access to social or pension protection — take a growing share of the working population: 45% according to FKTU, 36% according to government.

In September 2015 the government signed a tripartite agreement with employers and the FKTU to tackle the problem of non-regular workers including by increasing their employment security. But a month later, the Bill presented at the Parliament contained radically different measures: further flexibility on the use of non-regular workers, temporary agencies and dispatched workers, no accompanying measure to improve employment security. The FKTU had no other choice than to withdraw from the tripartite framework.

New “administrative measures” were also introduced to facilitate dismissals of “underperforming” workers and arbitrary change in employment conditions. The list may not end here. Nearly half of all collective agreements have clauses on information, consultation and representation of workers — akin to “worker participation” rights in Europe. The government has made clear its intention to ban these “illegal and irrational collective bargaining practices” as well as trade union members in company-level worker committees.

Both FKTU and KCTU point to the responsibility of the ruling party Saenuri (which did not do too well at last week parliamentary elections ) but also of the Chaebols. Both claim that policy making in Korea today, has turned into an exclusive conversation between the government and big business leaders.

The Korean “red tape” agenda is a testimony of it. In December 2014, a year before the tripartite agreement and the bill presented to parliament, the Prime Minister’s Office held a meeting with large business representatives and organisations participating in a “Regulatory Reform Committee”. The meeting aimed at “getting rid of inconvenient and inefficient regulations that are not compatible with market principles and hold back economic innovation”. Over 150 business proposals were presented, including the very same measures that were to surface in the draft Bill a year later: greater access to fixed-term workers and dispatched worker, layoff of “low-performing workers”, etc.

In essence, the tripartite agreement of September 2015 was never taken seriously by the government. It was by-passed by the parallel “regulatory reform” process and the meeting in December 2014 from which unions and other non-business stakeholders were excluded.

Do the Chaebols have the appropriate governance and management in place that meet their power and influence over the Korean economy and beyond? Not sure. An OECD report covering corporate governance in Korea points to the opacity of “pyramid” group structures, of badly managed “related party transactions” and to the limited rights of minority shareholders against the risk for controlling shareholder abuse. On responsible business conduct, the implementation of the OECD Guidelines for Multinational Enterprises is far from being a reality in Korea. The Korean National Contact Point is poorly performing. In the past it has had a high level of partiality in dealing with trade union and NGO cases.

All OECD member countries should adhere to and observe the fundamental values of the Organisation: “pluralistic democracy, respect for human rights, and a competitive market economy”. Since 2007 and the end of the “special monitoring process”, the OECD has been silent on the violation of labour rights and freedom of assembly in Korea. This has happened despite the commitment by Korea in 1996 and despite the clear mandate of the OECD to deal with both industrial relations and public governance. Instead, key recommendations in past OECD Economic Surveys of Korea have aimed at weakening further employment protection of Korean workers, with little consideration of the rights and protection of non-regular workers specifically.

The OECD has a responsibility in accompanying Korea on a sustainable and inclusive growth path. The 20th anniversary comes at a right time for devising a roadmap for sustainable and inclusive Korea — that’s the proposal of the TUAC. It has the committees and the instruments to achieve that: the Council and the Employment Labour and Social Affairs committee of course, but also the Education committee (teachers’ rights), the Regulatory Policy Committee (stakeholder engagement in regulatory reform), the Public Governance committee (freedom of assembly and rule of law), the Investment and the Corporate Governance committees (responsible business conduct and governance of the Chaebols).