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CB-Korea-Final-_163Report on the Survey on Industrial Relations in
East Asia
COLLECTIVE BARGAINING IN KOREA
2
Report on the Survey on Industrial Relations in East Asia
COLLECTIVE BARGAINING IN KOREA
Prepared by Dr Kiu Sik Bae Research Fellow, Korea Labor
Institute
ILO-Japan Multi-Lateral Project, 2006
3
COLLECTIVE BARGAINING IN KOREA Prepared by Dr Kiu Sik Bae, Research
Fellow Korea Labor Institute © ILO- Japan Multi-Lateral Project,
2006 International Labour Organization Subregional Office for East
Asia United Nations Building Rajdamnern Nok Avenue P.O. Box 2-349
Rajdamnern Bangkok 10200, Thailand
4
Contents Part 1: Legislative and Institutional Framework for
Industrial Relations A. Historical background to Industrial
Relations in Korea
Political authoritarianism, Industrialization and the Korean
business system Formation of Industrial Relations Systems in Korea
Establishment of 1987 Industrial Relations Systems
Part 2: Industrial Relations Actors A. Government B. Employers C.
Employees
Part 3: Legal and Institutional Framework and Practice of
Collective Bargaining A. Legal Sources and Relevant Legislative
Provisions
Sources of collective bargaining Unfair labour practices
Unfavourable treatment ‘Yellow-dog’ Contract and union shop Refusal
or protracting of bargaining Dominance or interference in union
internal affairs Unfair treatment of reporting or testifying in
relation to unfair labour practices Remedies of unfair labour
practices
B. Duty to Bargain
Definition and Legal Status of Collective Agreement Parties to
collective bargaining Bargaining power of parties Subject Matters
in Collective Bargaining Concluding a collective agreement Valid
term of a collective agreement Effect of Collective Agreements on
Employment Contracts and Company Rules Scope of application
Bargaining coverage and significance of collective agreements
Bargaining Level
Part 4: Trends, Issues and Debates: Social partners’ and Political
Actors’ Views and Proposals for Future development of national
Bargaining Systems A. Major Issues in Collective Bargaining
5
B. Summary and Conclusions
6
Part 1: Legislative and Institutional Framework for Industrial
Relations A. Historical background to Industrial Relations in Korea
Political authoritarianism, Industrialization and the Korean
business system After the Korean War in 1950-53, Korea had a very
strong state over an underdeveloped civil society. At the end of
the war against the communists, Korean society had become a
conservative one in which trade unions were often regarded as an
auxiliary organization of communism. The left-leaning labour
movement was politically eradicated from the industrial scene
during the war. Authoritarianism predominated the political scene
in South Korea after 1961 when a military coup d'état took place
against the nascent civilian government. Although opposition
parties and political freedom appeared to be allowed on the
surface, authoritarian governments that were supported by the
military controlled every corner of the country from the 1960s to
mid-1980s. The government not only controlled the political life of
people in Korea, but also had enormous power to run and regulate
economic activities. When the Park Chung-Hee government initiated
the successive Five Years' Economic Development Plans in 1960s, it
was able to mobilize the scarce resources at the time for
industrialization. The Economic Development Plans were successfully
implemented by the government. Thereby the government led the
industrialization process through the export of goods during the
period of the 1960s - 80s. Up until 1986 the government had
sufficient power to drive the country’s economic growth and manage
the macro-economic coordination among economic actors.
Industrialization gave birth to the ‘chaebol’, which was a business
conglomerate with vertically integrated systems. It had a large
parent firm with cross-owned shares in a number of other affiliated
firms. The government intentionally fostered the growth of chaebols
to make use of economies of scale and strengthen Korea’s
competitiveness in international markets. The state fostered and
encouraged Korean-owned chaebols through various financial supports
and subsidies or the protection of domestic markets against
competition of foreign firms. Although business organizations such
as the Chambers of Commerce or Confederation of Korean Business
existed, they were mainly a group which supported the interests of
the powerful government. While chaebols were able to enter new
industries by mobilizing capital through their subsidiary firms
with the government's financial support, they predominated the
markets in a number of sectors. From the late 1970s, substantial
new investments in the heavy metal and chemical industries were
possible because of the chaebol system which was centrally
controlled by the owners' families whom normally had minority
ownership of their affiliated firms. New industries for exporting
goods were more or less headed by the chaebol companies which had
relatively weak connections with local firms. Instead, chaebol
companies created subcontracting or supplier firms. External labour
markets for jobs in the industry were underdeveloped. There were
some strata and segmentation in the labour market along value
chains between large chaebol firms and their suppliers. This
chaebol-centred business system set the stage of developments in
industrial relations in Korea. Formation of Industrial Relations
Systems in Korea The formation of industrial relations systems in
Korea has been closely associated with the political history of the
post-Korean War, industrialization, the related state policies and
Korean business system. Although a set of labour laws was already
legislated in the early 1950s, it largely remained in rhetoric. Up
until the mid-1980s, there were big gaps between the provisions of
the labour law and their implementation and practice.
Industrialization driven by the export of low value-added goods was
based on low labour costs, which in turn required the state to
control labour affairs in the 1960s - 70s. To a large extent, the
state had controlled collective organization of labour by
restricting trade union activities. Some
7
independent trade unions were excluded and often repressed by
authorities. The founding leaders of the Federation of Korean Trade
Unions (FKTU) were actually nominated by the state intelligence
agency. The FKTU was later supported and controlled by the state.
Reflecting the characteristics of the labour market and encouraged
by the state’s labour policies, nearly all trade unions were
organized at the enterprise-level, though trade unions mimicked
industry-based unions in their formal structures. In the late 1960s
and throughout the 1970s many new trade unions were organized at
the enterprise level by rank-and-file workers with little
assistance from industry-based unions, even under the conditions
imposed by the authoritarian state.
1 Union density increased from 12.6% in 1970 to 14.7% in 1980. The
voluntary
‘grassroots’ trade union movement became more active in the 1970s,
even though it was always subject to oppression under the
authoritarianism.. Only enterprise unions were legally allowed from
1980 onwards. There was some movement to make trade unions
independent of employers and the state. However, it was crushed by
the authoritarian government in the 1970s and early 1980s. Mostly
docile trade unions under the umbrella of the FKTU were allowed by
the state and employers. Full-time union officials who were also
union executives at the enterprise level were paid by their
employers in return for their cooperation with the companies. The
state increasingly restricted workers' freedom of association to
organize trade unions in the early 1980s. Because trade unions were
quite weak or dependent on employers to a large extent, collective
bargaining at the enterprise level was not supported by the
meaningful exercise of bargaining power on the part of unions.
Apart from some sectors such as taxi, bus and cotton textiles,
collective bargaining in most sectors was conducted at the
enterprise level. Employers had the upper hand in bargaining on
wages, terms and conditions of work. Collective actions including
strikes were legally allowed but in practice, actual collective
actions by unions were very limited. The sense of solidarity among
unions was fairly weak. Sacrificing their independence from
employers and the state, most trade unions played the role of a
junior partner, or remained subservient, to employers at the
enterprise level and the state at the national level up until 1986.
It was criticized that most FKTU-affiliated trade unions had become
an organization of the labour-management department of the firm. In
other words, trade unions to a great extent became an organization
within firms. Though trade unions were not organized at most big
chaebol firms until 1986, industrial relations based at the
enterprise level was established as a system. Establishment of 1987
Industrial Relations Systems (1) Political democratization and 1987
Industrial Relations System Political freedom won from the
hard-fought struggle for democracy in 1987 gave workers at
non-unionized firms’ fresh opportunities to organize their own
'democratic unions' independent of their employers and the state at
the enterprise level.
2 Many workers who felt that they had
been unfairly treated and excluded from important decision-making
on their wages and terms and conditions of work went on strikes
across the country, while they organized their own 'democratic
unions'. Most newly organized trade unions had a strong desire to
remain independent of their employers. This was fundamentally
different from the incumbent FKTU-affiliated unions which had been
subservient to employers. Most of the unions that were affiliated
to the FKTU became more active than before, but remained moderate.
The institutional inertia of FKTU-affiliated unionism lasted
throughout the 1990s. Even though the state allowed workers to
organized trade unions at the enterprise level, employers did not
allow their employees to organize their own 'democratic' unions.
Many
1 The ostensible form of trade unions in the 1960s and 1970s was
industrial unions, though the real form of trade unions was based
on enterprises. Most union activities, including collective
bargaining, took place at the enterprise level. Most union
activities were conducted at the enterprise level. 2 'Democratic
Unions' aimed to be independent of employers and state
intervention, compared with the FKTU-affiliated unions which were
hitherto subservient to employers and the authoritarian government
and sacrificed their members' interests. Newly organized trade
unions declared themselves as being 'Democratic Unions' from 1987
onwards.
8
employers strongly opposed the establishment of employees' unions
at their enterprises and often resorted to various means of
physical acts and bribes. However the state and employers had no
choice in finally recognizing 'democratic unions' because the trade
union movement received strong support from the workforce and
general public, and began to exercise their power by going on
strikes. From June 1987 onwards, political democratization in Korea
led a gradual shift away from unitarism towards pluralism in
industrial relations. The driving force which changed the
industrial relations system just after June 1987 was the power
which new trade unions began to exercise. Newly formed 'democratic
unions' organized most of the non-managerial employees and
represented many workers at the enterprise level whom had
accumulated much discontent and demands over the years. New
'democratic unions' became stronger and were able to have a strong
presence at the workplace. Workplaces have become strongholds of
unions where trade unions were able to exercise their power over
employers. Most enterprise unions were able to get their full-time
union officials paid by their employers. The number of union
officials increased in proportion to the number of enterprise union
members. This was an outcome of unions' strong collective power at
the enterprise level. Trade unions which had been docile to their
employers were transformed into effective weapons for stringent
resistance to employers. Big chaebol firms in the heavy metal and
chemical industry became a fertile ground for strong
enterprise-based unions. The 1987 industrial relations system
developed in the midst of political democratization as a subsystem
of the political social regime at that time. This system was also
established in the backdrop of rapid economic growth, relatively
protected markets, chaebol-centred business system, shortage of
labour supply and rising expectations among workers. The
enterprise-based industrial relations system became firmly
established in a form different from that of pre-1987. (2)
Characteristics of the 1987 Industrial Relations System Employers
have preferred enterprise unions to industry unions or regional
unions. They envisaged Korean unions becoming more like Japanese
ones. They believed that trade unions based on an industry or
regional level, therefore external to the firm, tended to be
dangerous and radical. This belief was shaped by a labour law
provision under the military authoritarianism in the latter half of
the 1970s and the first half of the 1980s that anybody who
intervened as a third party in enterprise-level industrial
relations must be punished. Trade unions were basically organized
at the enterprise level and its decision-making power rested with
the enterprise unions. Employers were engaged in employment
relations at their firms on their own without much coordination
with other employers. Because employers' organizations had not been
developed very well, there was a lack of coordination or
centralized power among employers. Table 1.1: Reform of labour law
since 1987
The 1987 - 1989 Revision The 1997 - 1998 Revision
Charact eristics
• Restrictions on union activities lifted
• Free union activities including political activities
• Revision of labour laws to enhance labour market
flexibility
Laws on Collectiv e Labour Relation s
• Not only enterprise unions but other unions were allowed
• Restrictions on union organizing lifted
• Union shops allowed
• Restrictions on qualification for
• Multiple unions permitted at confederation level; 5 year
suspension on multiple unions at the enterprise level
• Prohibition of wage payment by employers for full-time
union
9
• Political activity of trade unions permitted
• Restrictions on industrial action by defence employees were
changed to match that of the public sector
• The scope of public utility services reduced
officials
removed
• Partial relaxation of ban on industrial action in the defence
industry
• Public Servants councils allowed
Laws on Individu al Labour Relation s
• Introduction of the flexible-work hour system
• Introduction of the collective dismissal system:
⇒ For business contingencies, all efforts to avoid dismissals must
be exhausted;
⇒ Fair selection of workers for dismissal;
⇒ Consultation with labour representatives;
⇒ Introduction of retirement pay in advance.
• Revision of the collective dismissal system:
⇒ Permitted in the case of mergers and acquisitions carried out to
prevent collapse of business;
⇒ Dismissed workers must be given priority in recalls.
• Revision of law on agency work:
⇒ Permitted in 26 occupations including the service industry;
⇒ Unfair treatment of agency workers in the same occupation not
permitted.
Source: Chul-Soo Lee, Revision of Korean Labour Laws and Industrial
Relations, 2000. As shown in the table above, the industrial
relations system in Korea was changed by political democratization
and economic deregulation and its subsequent revision of labour
law. There were two important periods in which major revisions of
the labour law were made in order to reshape industrial relations
institutions. The 1987 industrial relations system was very much
fragmented with little coordination among employers. On the other
hand, trade unions often organized collective campaigns or actions.
Decisions on wages and terms and conditions of work were made at
the enterprise level. The state assumed the role of coordinating
enterprise-level industrial relations at the macro-economic level
and often intervened in large industrial strives at the enterprise
level which had a national impact. Trade unions were internalized
with a strong presence at the enterprise level. 'Democratic unions'
and employers made every effort to strengthen their respective
bargaining power. They have often relied on physical, sometime
unlawful, means to force the other party into submission. During
the process, trade unions and employers have lost trust in each
other as well as built up tensions and confrontations. Conflicts
between trade unions and employers
10
have been internalized within the firm where there are 'democratic
unions'. These 'democratic unions' took advantage of the economic
boom and optimism at the time. Trade unions with a strong power
base at the workplace combined with employers' preference to
enterprise unions gave birth to Korean-specific enterprise
unionism. Trade unions became an effective means for increasing
wage levels and improving terms and conditions of work. This type
of trade unions later affiliated to the Korean Confederation of
Trade Unions (KCTU). There have been other kinds of trade unions
which affiliated to the FKTU. They have remained moderate and
continued cooperating with employers. Even if they were under
strong pressure from their members to increase wage and improve
working terms and conditions, they tended to rely less on
collective actions than negotiations.
11
B. Employers
C. Employees There have been two national confederations of trade
unions in Korea. The FKTU (Federation of Korean Trade Unions) was
established in 1961 and grew as the only national organization of
trade unions recognized by the state. It had to give in to the
authoritarian government and employers at the expense of
sacrificing its members' interests. It remains an umbrella
organization that represents the moderate unions. The other federal
confederation is the KCTU (Korean Confederation of Trade Unions)
which was established in 1995 and registered as a legitimate union
in 2000. The KCTU was established by trade unions which were mostly
organized after June 1987. It has remained a strong union with much
bargaining and industrial power. Its affiliated unions have had
significant presence at workplaces in Korea.
12
Part 3: Legal and Institutional Framework and Practice of
Collective Bargaining Collective bargaining in Korea was not
extensive prior to 1987 because trade unions had weak bargaining
power. It remained insignificant in most instances. When a few
trade unions obtained strong bargaining power, the state intervened
in industrial relations at those firms and eventually assisted the
employers to abolish those unions from the 1960s to 1986. However,
as political democracy developed, many new trade unions were set up
and became much stronger than before. Trade unions were on the
offensive and employers the defensive side. Collective bargaining
was led by new powerful ‘democratic trade unions’ and resulted in
considerable wage increases and improvements in terms and
conditions of work until the mid-1990s. When the Asian financial
crisis hit the Korean economy at the end of 1997, unions had to
concede wage cuts, redundancies or reductions in corporate welfare
in their bargaining at almost all firms during 1997 – 1999. As the
economy emerged from the crisis, unions engaged in retake
bargaining during 2000-2001 to reclaim the concessions made during
the crisis. Bargaining patterns that were similar to the previous
ones returned at large companies. However, collective bargaining
was not the same at most medium firms.
A. Legal Sources and Relevant Legislative Provisions Sources of
collective bargaining The Constitution (Article 33) and subsequent
labour laws provide trade unions with the legal rights to freedom
of association, collective bargaining and industrial action. Korean
labour laws allow trade unions exclusive rights to negotiation
where unions are organized, irrespective of the proportion of their
membership in a certain bargaining unit. If employers at unionized
firms refuse to negotiate wages or terms and conditions of work
with the unions concerned, this refusal may constitute unfair
labour practices.
3
Unfair labour practices There are five types of unfair labour
practices in Korea: unfavourable treatment, ‘yellow-dog’ contracts,
refusal to negotiate with unions or protracting negotiations with
unions, interference in union internal affairs, and unfavourable
treatment of people with claims of unfair labour practices at the
Labour Relations Commission. If it is established at the Commission
that the employers in fact engaged in unfair labour practices
against their union member(s), a range of legal remedies are
available. An alternative remedy is filing a claim at the civil
courts on different grounds. Unfavourable treatment Pursuant to
Article 81 of the Trade Union and Labour Relations Adjustment Act
of 1997 (TULRAA), the following practices by employers constitute
unfavourable treatment:
• Dismissing an employee or discriminating against him/her on the
ground that the employee intends to establish a union, has joined a
trade union or has performed proper trade union activities.
• Dismissing an employee or discriminating against him/her on the
ground that he/she has taken part in industrial action.
‘Yellow-dog’ Contract and union shop
3 The concept of unfair labour practices was introduced into the
Korean industrial relations system from the USA. It was intended to
prevent employers from infringing upon the fundamental rights of
workers and to promote the protection of workers and trade unions
from employers' abuse and intervention in trade union
affairs.
13
A ‘yellow-dog’ contract is an employment contract in which
employers forbid an employee to join a trade union or order the
employee to join a particular union. ‘Yellow-dog’ contracts are not
legally enforceable. Where a union represents two-thirds or more of
the employees in the workplace, the employer may conclude a
collective agreement which guarantees 'union shops'. In this case,
the employer shall not take disciplinary action against the
employee just because he/she has been expelled from the union.
Refusal or protracting of bargaining Refusing or protracting
collective bargaining with trade unions, without a justifiable
reason, constitutes unfair labour practice. Dominance or
interference in union internal affairs This unfair labour practice
consists of
• Dominating or interfering with union internal affairs or union
activities by paying wages to full-time union officials;
• Giving financial support to cover the union's operation costs or
by other means. It excludes consultation or bargaining with trade
union officials; employers contribution to employee welfare or
prevention of relief from economic difficulties or other hardship;
or provision of minimal facilities for the union at the workplace.
Unfair treatment of reporting or testifying in relation to unfair
labour practices It is unlawful to dismiss an employee or
discriminate against him/her on the ground that he/she has reported
an incidence of unfair labour practice by the employer to the
Labour Relations Commission, or has testified about such offences.
Remedies of unfair labour practices (1) Remedies by administrative
procedures There is a two-pronged approach to remedying unfair
labour practices: restoration and punishment. Employees or a trade
union whose rights have been infringed upon by the employer's
unfair labour practices, may take their case to the Regional Labour
Relations Commission for remedies. Alternatively, the punishment
approach involves the employee or union bringing a complaint or
accusation against the employer to the labour inspector. (2)
Remedies by civil procedures Apart from the administrative
procedures mentioned above, the employee or union may bring a civil
lawsuit against the employer for reinstatement of dismissed
employees or claim for damages.
B. Duty to Bargain Good faith obligation The parties to collective
bargaining are obligated to negotiate and conclude a collective
agreement in good faith and not to abuse their bargaining power. An
employer, who refuses, omits or delays to conduct collective
bargaining or conclude a collective agreement without giving a
reasonable justification, commits an act of unfair labour practice
which is subject to criminal penalization (Art. 30 paras. 1 and 2
of the TULRAA).
C. Collective Bargaining in Practice
14
Definition and Legal Status of Collective Agreement A collective
agreement refers to a written agreement signed and sealed by the
parties to collective bargaining (the trade union and the employer
or the relevant employers’ organization). The agreement contains
the terms that have agreed upon in the process of the negotiations
with regard to wages, hours of work and other conditions. Parties
to collective bargaining The parties to collective bargaining are
legal persons or entities whom conduct the bargaining in their own
names and subsequently assume their rights and obligations in the
collective agreement. The parties are generally the trade union
involved and the employer or his/her representative organization.
In collective bargaining, the employees are represented by a trade
union that fully satisfies the qualifying requirements of TULRAA.
The employer is represented by a corporation in the case of an
incorporated business, or an individual employer in the case of an
individual enterprise. An employers' organization can also be a
party to the collective bargaining process of a member employer,
where it has the authority to control or regulate industrial
relations affairs of the particular member employer. Both the union
and employer may delegate authority to an appointee to conduct
collective bargaining or conclude a collective agreement. The
appointee will exercise the delegated authority within the scope
granted to him/her. Bargaining power of parties There are three
factors which affect the bargaining position and power of each
party: the labour market situation, the relative power of trade
unions against employers, and government policies or institutions
which either support or discourage trade unions and collective
bargaining. Up until 1986, unions’ bargaining power was not strong
mainly because of government policies. Apart from the mid-1980s,
the labour market situation was not favourable to trade unions.
From mid to late 1980s, the Korean economy benefited from the
so-called 'three lows' - low interest rates, low dollar and low
fuel price, which were able to strengthen the economy’s cost
competitiveness. There was a boom in the economy and labour was in
high demand. As a result, the labour market tightened between mid
to late 1980s. Trade unions became independent of employers and the
state, and began to increase their power within firms at that time.
Government policies and institutions which restricted employees
from setting up unions, going on strikes and volunteering for union
activities were more or less lifted. The tight labour market,
strong power of trade unions, and removal of restrictive government
policies concurrently occurred in the late 1980s. Trade unions were
able to strengthen their bargaining power against employers at
their respective firms. Enterprise unions which had originally been
introduced by the authoritarian state to control trade unions
ironically became a strong weapon for trade unions to build their
power base at the workplace. As shown below in Table 3.3, 77 per
cent of large firms with more than 500 employees were unionized. As
most firms with strategic significance were unionized, trade unions
were able to exercise considerable power despite low union density.
Most employers were not well prepared to bargain with unions which
suddenly gained so much power. Trade unions had the upper hand in
collective bargaining. Since 1987 trade unions at the enterprise
level have pursued distributive bargaining to increase their wage
level and improve employment conditions by using their strong power
at the workplace. Distributive bargaining was initially accepted by
employers in the context of the economic boom and optimism in the
late 1980s. Distributive bargaining driven by most enterprise
unions under the KCTU was very successful until the early 1990s.
Wages nearly doubled and working conditions and employment benefits
significantly improved, especially at
15
unionized medium and large firms, over the period of 1987 - 1994.
Many small and medium-sized enterprises (SMEs) were under pressure
to increase wages and improve conditions of work. There was some
spill-over in wages and working conditions from large firms to
SMEs. Wage increases in large unionized firms were a driving force
for those in SMEs. Subject Matters in Collective Bargaining The
subject matters in collective bargaining are confined to the ones
that, in general,
• can be handled or taken care of by the employer;
• are of collective nature (i.e. the matter does not concern only
one employee); and
• are associated with the improvement of employees’ working
conditions, without prejudice to the employer's right to business
and personnel management.
The bargaining agenda generally includes workplace issues,
compensation and welfare at the enterprise level. In principle,
matters concerning the employer's right to business and personnel
management are excluded from collective negotiations. However, they
can be dealt with at the bargaining table so far as they directly
relate to the improvement of working conditions and their inclusion
is not indicative of denying the employer the right to business and
personnel management. Individual grievances that arise in the
employment relationship, such as ones relating to overdue wages or
dismissal, cannot be dealt with in the process of collective
bargaining. However, these grievances can be resolved through other
channels such as the Labour-Management Council at each workplace.
Matters which are beyond the employer's reach, including enactment
or revision of laws or regulations, opposition to the government's
policy measures and political issues, should not be discussed at
the bargaining table. Enterprise unions have tried to obtain
control over various aspects of workplace operations through the
enterprise-level bargaining agenda. Confrontation and a lack of
trust between management and unions have triggered unions to seek
formal or informal bargaining on many issues that are supposedly
related to working conditions. More and more issues are coming onto
the bargaining table at each bargaining round and session of
Labour-Management Councils. As a result, workplace issues are
increasingly subject to ‘deep’ and heavy regulation through
collective bargaining. There has been much concern about the
rigidities in industrial relations at the workplace which arise
from the depth of regulation of various workplace issues. Figure
3.1 below shows the trade-off between depth and coverage of
collective bargaining in Korea compared with Western European
countries. Figure 3.1: Coverage and Depth of Collective
Bargaining
16
Concluding a collective agreement The right to conclude a
collective agreement is given to the union representative(s) and
the employer. It is not permitted for any rules, regulations or
other form of instruments to restrict the union representative’s
right to conclude collective bargaining and the negotiations of
collective agreements. Valid term of a collective agreement The
collective agreement’s term of validity must not exceed 2 years.
The parties are free to determine the valid term of the agreement
so far as it is 2 years or less. In case the parties had not
specified the effective duration of the collective agreement, or
had set a term of more than 2 years for the validity of the
agreement, the actual valid term is deemed to be 2 years. If a new
agreement has yet to be concluded, even though the parties have
conducted negotiations to renew the agreement, the previous
agreement shall remain valid for 3 months from its date of expiry.
A collective agreement shall remain effective until a new agreement
is signed, even after its term of validity had expired, if such is
provided by the agreement. In this case, if a party intends to
terminate the agreement, it should notify the other party of such
termination no later than 6 months before the date of termination.
Effect of Collective Agreements on Employment Contracts and Company
Rules Provisions contained in rules or contracts of employment that
are incompatible with the standards of working conditions and
employee treatment in the collective agreement shall be deemed
invalid. As for matters that are not specified in the contract of
employment, or are specified in the contract but are not compatible
with the relevant provisions of the collective agreement, the
standards specified in the collective agreement shall be applied.
Scope of application
17
In principle, a collective agreement shall apply to the trade union
(and workers whom are union members) and the employer who have
concluded the agreement. Nevertheless, where an enterprise based
agreement covers a majority of permanent workers at a company or
workplace (i.e. more than 50% of workers are union members), the
normative provisions on working conditions contained in the
agreement shall apply to the remaining workers (non-union members)
whom are employed in the same kind of job (Arts. 35 and 36 of the
TULRAA). Bargaining coverage and significance of collective
agreements The bargaining coverage refers to the proportion of the
workforce covered by collective bargaining. Collective agreements
have applied only to employees at unionized firms because most
trade unions were enterprise-based and collective bargaining took
place at the enterprise level. Therefore the bargaining coverage in
Korea is more or less equal to union density, as shown below in
Table 3.1. Table 3.1: Union density
Year No. of Unions Membership Union density (%)
1965 2,634 301,522
2003 6,257 1,549,949
Source: The Ministry of Labour. Bargaining coverage in Korea has
remained relatively low compared to that of advanced economies. As
shown in Table 3.2 below, most advanced economies (except for the
USA and UK) have had some extension mechanisms whereby collective
agreements concluded between unions and employers can be extended
to employees in non-union firms. Apart from labour laws, those
extension mechanisms which Korea lacked have been effective in
regulating employment relations at non-union firms in advanced
economies. Table 3.2: Bargaining Coverage in Advanced Economies,
2000 Country
Korea Japan UK USA Germany France Italy Sweden
Coverage (%)
10+ 15+ 30+ 14 68 90 + 80+ 90+
Source: OECD (2004), Employment Outlook, Paris, p.145. Bargaining
coverage is uneven depending upon the size of firms. As shown below
in Table 3.3, 77 per cent of large firms with more than 500
employees are unionized, while 5.8 per cent of small firms with 5 -
9 employees are unionized.
4 Large firms are mostly unionized and their
employees are covered by collective bargaining, while small firms
are mostly non-unionized
4 Very small firms with 1-4 employees account for 84.1 per cent of
the total number of companies in Korea and 32.9 per cent of the
total number of the employed workforce. Firms with more than 100
employees account for only 0.36 per cent of the total number of
firms and 21.9 per cent of the total number of the employed
workforce.
18
and their employees are not covered by collective bargaining. Table
3.3: Proportion of unionized firms by size (no. of employees)
Size of firm (Number of employees)
1 - 4 5 - 9 10 - 29 30 - 99 100 - 299
300 - 499
0 5.8 14.3 24.8 51.7 68.4 77.0
Source: Korea Labor Institute (2005), KLI Labour Statistics.
Bargaining coverage across different types of employment varies
quite significantly. As shown below in Table 3.4 union density and
therefore bargaining coverage is relatively high for permanent
workers. However, union density and bargaining coverage for
temporary workers and workers hired on a daily basis remain
negligible. Overall, bargaining coverage remains very low in Korea
because of the enterprise-based industrial relations system and a
lack of extension mechanisms for collective agreements. Employees
in SMEs, temporary workers and workers hired on a daily basis are
least likely to be covered by collective bargaining. Table 3.4:
Trade union density by employment type, August 2004
No. of wage earners
(in 1,000) Union membership
(in 1,000) Union density (%)
Workers hired on a daily basis
2,071 8 0.4%
Source: Korea Labor Institute (2005), KLI Labour Statistics.
Bargaining Level Collective bargaining can take place at the
establishment level, enterprise level, sub-sectoral level, regional
level, industry level, or national level. Collective bargaining in
Korea has mostly occurred at the enterprise level before the
massive strikes in 1987 and even thereafter. The bargaining level
tended to be determined at the level where most unions were
organized. Except in some special instances, enterprise unions were
able to engage in collective bargaining only at the firm/enterprise
level. It was natural that employers and trade unions negotiated
wages and conditions of work at the enterprise level under the
enterprise-based industrial relations system in Korea. There were
small exceptions in areas such as cotton textiles, urban bus and
taxi transportation in which sub-sectoral bargaining or regional
bargaining took place over the years. Trade unions in Korea began
transforming their organizational forms from enterprise unions to
industry-based unions during the late 1990s and early 2000s. The
development of industry-based unions has become a long-standing
objective of the Korean union movement with the aim of increasing
solidarity among workers and overcoming the fragmentation of
unions. KCTU-affiliated enterprise unions, especially in the metal
and hospital industry, reorganized themselves into industry-based
unions. At the end of June 2006, 97,000 members (including
employees at Hyundai Motor Union, Kia Motor Union, Daewoo Motor
Union and other big enterprise unions) joined the metal industry
union. As of July 2006, nearly sixty per cent of the KCTU
membership belonged to industry-based unions.
19
Table 3.5: Types of KCTU-affiliated Unions and their memberships
(June, 2006)
Type of unions No. of unions Membership Proportion of
membership (%)
Sub-sectoral or Industry-based unions
Total 742 638,180 100
Sources: Korean Confederation of Trade Unions, KCTU home page,
www.kctu.org (accessed: 2006); Korean Metal Workers' Union, KMWU
home page, http://metal.nodong.org (accessed: 2006). Wage
bargaining is still overwhelmingly conducted at the enterprise
level, as shown below in Table 3.6. Following the developments in
collective bargaining in some sub-sectors and industries, the
proportion of sub-sectoral bargaining, industry bargaining and
regional bargaining has increased since 2000. Collective bargaining
above the enterprise level accounts for roughly 19 per cent of all
collective bargaining. Table 3.6: Level of Wage Bargaining
Level of CB Enterprise
NB: *’Enterprise Bargaining I’ refers to bargaining between
management and enterprise unions. ** ‘Enterprise bargaining II’
refers to bargaining between management and industry-based unions.
Source: KLI (2005)
20
Part 4: Trends, issues and debates: social partners' and political
actors’ views and proposals for future development of national
bargaining systems
A. Major Issues in Collective Bargaining Move to Industry-Level
Bargaining As enterprise unions merged into industry-based unions
or sub-sectoral unions, there has been an increase in demand for
industry-wide bargaining or sub-sectoral bargaining on the part of
trade unions. Employers in Korea have favoured enterprise
bargaining much more than industry or sub-sectoral bargaining. This
is despite the fact that enterprise bargaining has not led to
desirable outcomes for employers. The reasons why employers do not
like sub-sectoral or industry bargaining are ideological and
practical. Employers fear that sub-sectoral or industry bargaining
driven by those unions may be accompanied by massive strikes at the
sub-sectoral or industry level, and that they may have to negotiate
with supposedly ‘radical’ third parties. Employers have also
experienced significant conflicts with sub-sectoral or
industry-based unions over the issue of whether employers have to
take part in collective bargaining at the sub-sectoral or
industrial level led by those unions and accordingly form
employers' associations for this purpose. Moreover, there has not
been an employers' association to lead collective bargaining at the
sub-sectoral or industry level on the part of employers. No one has
been able to coordinate employers' interests in collective
bargaining at the industry level, despite strong pressures from the
sub-sectoral or industry-based unions. This was one of the key
reasons why collective bargaining at the sub-sectoral or industry
level was often protracted and flared up into industrial action. In
addition, some large employers in the metals industry (where many
employees were organized by the industry-based union) refused to
participate in collective bargaining at the industry level. These
employers perceived their industrial power to be strong enough to
resist the union's demand for industry-level bargaining. They
insisted upon collective bargaining at the enterprise level
instead. Although there have been conflicts between employers and
industry-based unions, and many trial and errors surrounding
collective bargaining at the industry level, there have been some
positive developments in the metals and hospital industries.
Employers' associations were organized in those two industries in
2006 for the purposes of industry-level collective bargaining. Wage
bargaining at the industry level was concluded without much
industrial action in 2006. Industry-level bargaining in the metals
industry was primarily conducted at SMEs; whilst in the hospital
industry there was a range of large and small hospitals involved.
Along with these developments at the industry level, there has been
some significant advancement in sub-sectoral bargaining in areas
such as securities, life and property insurance, agricultural and
fishery cooperatives, driving schools and electricity generation.
Korean trade unions are still experimenting with reorganizing
themselves into industry-based unions and centralizing
enterprise-level bargaining into industry-level bargaining. As
unions at large firms are increasingly reorganizing themselves into
industry-based unions and seeking industry-level bargaining rather
than enterprise-level bargaining, industrial conflicts and disputes
relating to industry-level bargaining may follow. New attempts at
industry-level bargaining by the powerful metals industry union
(which includes the Hyundai Motor Union, Kia Motor Union and Daewoo
Motor Union) may not be so easily resisted by the respective
employers. There may be further developments in industry-level
bargaining in this sector next year. However, depending on the
bargaining strategies pursued by the metals industry union and any
changing political and economic circumstances, the realization of
these developments is uncertain. Many issues relating to
industry-level bargaining remain undecided. Pattern Bargaining and
Bargaining Coordination The employers' organization and the two
confederations of trade unions (the FKTU and the KCTU) are supposed
to coordinate wage bargaining among their members. They have
21
suggested a yearly guideline for wage increases and key
considerations for collective bargaining for their respective
affiliated unions and employers. However their capacity to
coordinate bargaining has been very limited. There were no
employers' organizations at the sectoral level until recently. Even
though there were a number of industry-based union federations
under the FKTU and KCTU, they have not had much capacity to
coordinate the bargaining activities of their affiliated unions. A
kind of pattern bargaining which were initiated by powerful
enterprise unions emerged in key industries such as automobile,
electronics and shipbuilding. For instance the Hyundai Motor Union
tended to set a pattern for the annual wage round in the automobile
industry and other metals industries. This was normally done by
going on strike for a number of days and then concluding the
bargaining at a rather high premium. Other large unions in the
automobile industry and other industries would follow suit in terms
of the wage increases. Moreover, other large unions would add
extras like bonuses, benefits or welfare programs to the wage
increases spearheaded by the Hyundai Motor Union. These additions
have brought about ‘leapfrogging’ in wage bargaining among big
companies. Figure 4.1: Trend in wages by firm size
Source: Ministry of Labour (2005), Monthly Labour Survey. This sort
of pattern bargaining led by big enterprise unions had the tendency
of spreading relatively high increases in wages over to other
medium firms in the same sector or region. However, these
spill-over effects have increasingly been limited to large firms of
the chaebol groups because of the growing gaps between the high
performing big firms and more modest performing SMEs. Wage gaps
between different sized firms have widened since 1999. Large unions
with strong bargaining power are claimed to have increased the wage
gaps in recent years. Indirect Bargaining through Labour-Management
Councils (LMCs) One important feature of the Korean industrial
relations system lies in the compulsory establishment of
labour-management councils. Firms with more than 29 employees are
required by law to set up a labour-management council at the
enterprise level, where employee representatives are elected by
employees at non-unionized firms or appointed by the trade union at
unionized firms. The aim of labour-management councils is to
facilitate information sharing and consultation, promote employees'
participation in decision-making processes and build trust between
employers and employees. Employee representatives in
labour-management councils are supposed to be regularly consulted
by management on issues relating to work, employment, productivity,
training, grievance handling and employer-employee cooperation.
They are also involved, along with management, in making decisions
on training, education, welfare and the set-up of joint committees
in the workplace. According to the Act on Promotion of Employees'
Participation and Cooperation concerning the
22
establishment and operation of labour-management councils, an equal
number of representatives from management and employees sit on the
council, The number from each side ranges from 3 to 10, depending
on the firm size. The councils are required to hold a regular
meeting every three months and ad hoc meetings whenever necessary.
Labour-management council meetings shall be held with the presence
of a majority of both employee representatives and management
representatives. A resolution shall be made with the approval of
two-thirds or more of the representatives present.
Labour-management councils are similar to works councils in Western
Europe in some aspects but different in their composition of
employer and employee representatives. While European work councils
are employees' organizations, LMCs are organizations composed of
both management and employees representatives. Whereas works
councils in Western Europe have connections with trade unions
external to the firm, employee representatives in LMCs of
non-unionized firms in Korea have very few connections with trade
unions. As shown in Table 4.1 below, labour-management councils are
set up at more than sixty per cent of the total establishments with
more than 29 employees. The evidence suggests there is a
proportional rise in the presence of labour-management councils,
the larger the size of establishments. Taking into account the
statutory requirements for firms to set up LMCs at their
establishments, the proportion of establishments with LMCs is
remarkably high. Table 4.1: Proportion of enterprises with
labour-management councils, 2003
30 – 99 Employees
100 – 199 Employees
200 – 499 Employees
24,192 4,613 2,354 32,188
41,538 6,201 2,788 51,140
Ratio (A/B x 100) (%)
58.2 74.4 84.4 62.6
Source: Ministry of Labour (2004), The Current Situation of Set-up
of Labour-Management Councils by Establishment Size. Moreover, as
shown below in Table 4.2, the number of labour-management councils
has increased over the years, particularly at small establishments
with 30 - 99 employees. Table 4.2: Number of Labour-Management
Councils by Establishment Size
Year 30-99 employees
1997 16,985 4,396 2,106 964 24,411
2000 20,408 4,273 2,142 981 27,802
2004 26,403 5,030 2,388 1,048 34,887
Source: Ministry of Labour Most of the time, trade unions assume
the important role of employee representatives in labour-management
councils at unionized firms. The actual roles of employee
representatives on labour-management councils vary from having no
part or a minor part in consultation, to actual bargaining. This
depends on management’s attitude, the threat of union organizing,
firm size, region, sector and union influence. Some employee
representatives of labour-management councils play a significant
role not only in consultation on statutorily required matters, but
also in consultation or bargaining on wages and working conditions.
According to the results of the 2006 Workplace Panel Survey shown
in Table 4.3 below, employee representatives at more than half of
the surveyed labour-management councils discussed wage increases in
consultation with management.
23
Table 4.3: Discussion of wage increases at Labour Management
Councils in 2005
30-50 employees
50-100 employees
100-300 employees
N M(SD) N M(SD) N M(SD) N M(SD) N M(SD)
Employer responses
105 0.54 (0.50)
125 0.56 (050)
167 0.63 (048)
123 0.59 (049)
520 0.59 (049)
NB: Unit is expressed in decimals. N- Number; M- Mean; (SD) -
Standard Deviation. Source: Korea Labor Institute (2006) Workplace
Panel Survey Employee representatives at some labour-management
councils have more than just consultation rights on wages and
working conditions. As shown in Table 4.4 below, employee
representatives at twelve to sixteen per cent of all
labour-management councils surveyed are said to have wage
bargaining rights. Further, around ten to twelve per cent surveyed
have bargaining rights on working conditions. At two to five per
cent of labour-management councils, employee representatives even
have the right to strike. Thus labour-management councils have been
a vehicle whereby higher wages and better working conditions at
unionized firms, to a less extent, spill over to non-unionized
ones. Although labour-management councils were not designed for the
purpose of bargaining on wages and conditions, the unintended
consequences have been consultations and actual bargaining on those
issues. However, bargaining on wages and working conditions in LMCs
is still limited in the sense that most employee representatives
are not given time-off and external assistance to prepare for the
negotiations. Further, if negotiations within a LMC reach a
deadlock, employee representatives generally cannot use the threat
of strikes to put pressure on the employer. Table 4.4: Rights of
employee representatives at Labour-Management Councils
30 - 50
more than 300 employees (N=124)
Total (N=535)
Wage bargaining rights
0.13 (0.34) 0.12 (0.33) 0.16 (0.36) 0.15 (0.36) 0.14 (035)*
Collective bargaining rights
0.11 (0.31) 0.11 (0.31) 0.10 (0.31) 0.12 (0.33) 0.11 (031)
Right to strikes 0.05 (0.21) 0.02 (0.12) 0.03 (0.18) 0.02 (0.13)
0.03 (0.17)
NB: Unit is expressed in decimals. *(Standard Deviation) Source:
Korea Labour Institute (2006), Workplace Panel Survey In summary,
labour-management councils are used as forums for consultations and
indirect bargaining on wages and working conditions. Social
Dialogue Apart from the state-led labour policies, we did not see
developments in mechanisms to coordinate industrial relations
policies at the macro-level until the mid-1990s. The
enterprise-based industrial relations system was maintained through
the coordination and frequent interventions by the state as a whole
until then. However, it became increasingly difficult for the state
to introduce or change labour law or industrial relations policies
unilaterally. In the late 1980s and early 1990s the government
failed to conclude ‘three-way’ agreements for wage moderations with
employers and the moderate FKTU (which at the time, was not
supported by affiliated unions and criticized by the new
'democratic unions').
24
Immediately after the 1987 Democratization Declaration, the then
newly elected government allowed 'democratic unions' at the firm
level and sectoral level. However, it denied the formation of a
national organization of 'democratic unions' (the predecessor of
KCTU) for procedural reasons. The government and employers tried to
exclude the formation of a national organization of democratic
unions on legal grounds, and isolated it until the mid-1990s.
Around 1995 the civil government set up a tripartite body called
the Committee for the Reform of Industrial Relations together with
employers' organization, the FKTU and the KCTU, and independent
industrial relations scholars. The committee sought to give the
KCTU legitimate status on the one hand. It also sought to reform
the labour law in order to make it easier for employers to lay off
workers and thereby increase the flexibility of the labour market.
The Committee made some important progress in improving social
dialogue among the tripartite bodies, but eventually failed to
achieve its goal because top-ranking government officials decided
to reform the labour law unilaterally. The government faced
nation-wide strikes by a majority of the unions and workers, which
resulted in the renouncement of its reform bill. Another impetus to
social dialogue occurred during the 1998 financial crisis in Korea.
The nation urgently needed the reform of the labour law to make
redundancies easier for the purpose of speeding up corporate
restructuring. The new Kim Dae Jung government convened a
tripartite meeting with the employers' organization, FKTU and KCTU,
and pushed them to conclude a historic tripartite agreement on the
reform of the labour law in February 1998. The agreement comprised
of granting freedom of association to teachers and public servants
and more social security measures including unemployment policies
in exchange for provisions which make redundancies easier. While
the government institutionalized the Tripartite Commission as a
permanent organization, the KCTU withdrew from the Commission. The
government had to work with the employers' organization and the
FKTU at the Commission to discuss important policy issues such as
the reform of the public sector, introduction of the 40-hour
working week, legislation for migrant workers, temporary workers
and part-time workers. The KCTU has always resisted government
policies because they perceive the policies to be detrimental to
workers' interest or not sufficient to address them. Despite the
lack of consensus among parties, the Commission has managed to make
some progress in gathering the participating parties to hold a
social dialogue and reach agreements on some issues. Under the
enterprise-based industrial relations system, the social dialogue
encouraged through the Commission by the government was able to
fill the gaps between collective bargaining and labour-management
councils at the firm level and coordination of industrial relations
policies and practices at the macro level. This type of social
dialogue remains an important forum and the primary governance
mechanism for interested parties to participate in policy-making
processes at the macro level.
B. Summary and Conclusions In both industrialised and
industrialising countries, an industrial relations system provides
the framework for governing employment relations at the enterprise,
industry and national level. National systems (political, economic,
business, education, judiciary and health) are able to be supported
by a self-governing industrial relations system. Korea has
experienced significant developments and changes in its industrial
relations system over the years. The formation of industrial
relations systems in Korea has been closely associated with the
political history after the Korean War, industrialization, state
policies and the Korean business system. Before 1987, the state
intervened in the operations of industrial relations by controlling
trade unions in various ways in order to maintain relatively low
wages and industrial peace. Trade unions were quite weak and
dependent on employers to a large extent. Collective bargaining at
the enterprise level was not supported by unions possessing genuine
bargaining power. Most collective bargaining was conducted at the
enterprise level and industrial relations based at the
enterprise-level became established as a system.
25
The ‘1987 industrial relations system' developed in the midst of
political democratization. It was also established in the backdrop
of rapid economic growth, relatively protected markets, a
chaebol-centred business system, shortage of labour supply and
rising expectations among workers. The system of enterprise unions
which had been introduced by the authoritarian state to control
trade unions ironically became a strong weapon for unions. Trade
unions with strong power at the workplace combined with employers'
preference for enterprise unions (as opposed to industry based
unions) gave birth to a Korean-specific type of enterprise
unionism. Conflicts between trade unions and employers became
internalized within the firm. The growth of the trade union
movement helped to institutionalize collective bargaining as a
fundamental aspect of the industrial relations system in Korea.
Trade unions had the upper hand in collective bargaining. Wages
nearly doubled and working conditions significantly improved,
especially at unionized medium and large firms over the period of
1987 - 1994. However, the 1987 industrial relations system was very
much fragmented with little coordination in labour relations among
companies. The state assumed the role of coordinating
enterprise-level industrial relations at the macro-economic level.
The bargaining coverage of the enterprise-based bargaining system
in Korea remains very low. Bargaining coverage is uneven between
large and small firms, and between permanent, temporary and
daily-hired workers. Almost all collective bargaining has been
conducted at the enterprise level. From the early 2000s onwards,
many enterprise unions have reorganized themselves into
industry-based ones. As of July 2006, nearly sixty per cent of the
KCTU membership belonged to industry-based unions. There have been
increases in demand for industry-based bargaining or sub-sectoral
bargaining on the part of trade unions. Employers in Korea have
much favoured enterprise bargaining over industry or sub-sectoral
bargaining. Moreover there has been no employers' association to
lead collective bargaining at the sub-sectoral or industry level on
the part of employers. Although there have been conflicts between
employers and industry-based unions and many trial and errors
surrounding collective bargaining at the industry level, there have
been some developments in the metals and hospital industry. Korean
trade unions are still experimenting in reorganizing themselves
into these industry-based unions and centralizing the system of
enterprise-level bargaining into industry-level bargaining.
However, depending on the bargaining strategies pursued by the
industry-based unions and changing political and economic
circumstances, it is uncertain whether these developments will
successfully eventuate. Many issues relating to industry-level
bargaining remain unresolved. To date, no effective mechanism for
coordinating enterprise-level collective bargaining at the macro
level has been developed, apart from the ad hoc intervention of the
state. A kind of pattern bargaining which were initiated by large
and powerful enterprise unions emerged in key industries such as
automobile, electronics or shipbuilding. This sort of pattern
bargaining had a tendency of spreading relatively high wage
increases over to medium-sized firms in the same sector or regions.
However these spill-over effects have increasingly been limited to
large firms of the chaebol groups because there have been growing
gaps between strong performing large firms and more modest
performing SMEs in recent years. Korea has developed
labour-management councils as an indirect bargaining channel.
Labour-management councils were designed for information sharing,
employees' participation in decision-making, consultation and
building trust between management and employees. However their
roles are not limited to the above functions and sometimes extend
to wider consultation and negotiations on wages and working
conditions. Under the enterprise-based industrial relations system,
social dialogue encouraged through the Tripartite Commission by the
government was able to fill the gaps between collective bargaining
at the enterprise level and coordination in industrial relations
policies and practices at the macro level. Despite numerous
controversies surrounding the Tripartite Commission and its role,
this attempted form of social dialogue in Korea still remains an
important forum for relevant parties to participate in
policy-making processes at the macro level. Korea has developed an
industrial relations system based on enterprise unions and
enterprise
26
bargaining. The Korean industrial relations system has functioned
in a very different way to the Japanese system, in spite of the
enterprise-based nature of the two systems. For example, there are
well-developed informal mechanisms of coordinating collective
bargaining in Japan. In Korea, the state intervened and coordinated
collective bargaining before 1987. However, there has not been any
effective mechanism for coordinating collective bargaining after
1987. The diverging path between the two countries could be
accounted for by the different context of politics, history and
economic systems in the two countries. The industrial relations
system in Korea has benefited union-organized, permanent workers at
large firms to the exclusion of many workers in SMEs, and those in
temporary and precarious forms of employment. As such, the system
has been criticised for contributing to the bipolarization of the
labour market. The irony of the industrial relations system in
Korea is that it has generated numerous significant unintended and
often opposite consequences. For example although enterprise
unionism had been encouraged and legally imposed by the state to
foster moderate unions, it actually achieved the opposite result
with the growth of many militant KCTU-affiliated unions since 1987.
Labour-management councils which were designed for replacing trade
unions have become an indirect vehicle for bargaining. The
centralization process from an enterprise-based bargaining system
to industry or sub-sectoral bargaining led by KCTU-affiliated
unions currently remains at the experimental stage. Employers
prefer the status quo of enterprise bargaining. It is not clear
whether the trade unions that have driven the change, intend to
actively organize workers in SMEs and atypical workers and
represent them in collective bargaining. Therefore it is still
uncertain whether the attempt to centralize collective bargaining
will be successful and result in more inclusive industrial
relations system.
27
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