The National Congress of the Korean Confederation of Trade Unions (KCTU) resolved to call a general strike against the government’s comprehensive policy package to attack working and living conditions for all workers. In a nationwide ballot carried out between March 21 to April 8, 2015, 84.35 percent of all voters were in favor of going on a general strike. On April 24, striking workers will have rallies in 20 different cities. On May 1, 100,000 workers will gather in Seoul.
As the impact of the global economic crisis remains, the economic outlook of Korea is so negative as the finance minister warns of deflation risk. While Korea ranked top in taxation inequality among OECD countries due to the former government’s policy of ‘more tax from the poor and less tax from the rich’ and the 4th in income inequality, the real wage growth rate has decreased for the last 6 quarters successively. (It was 3.4 percent in the second quarter of 2003 and 0.08 percent in the third quarter of 2014.) The total number of the unemployed is 4,456,000, and the real unemployment rate is 15.8 percent. The poverty rate among the elderly is 48 percent, which means 1 out of 2 among those who are 65 years or older is living in poverty. More than 50 percent of the whole working population is in a precarious situation in terms of employment, and they are paid half of the average wage and not eligible for social security.
Recently, social polarization on a global scale has been pointed out as a key obstacle to economic growth. Even the major fora and financial institutions such as the G20 Finance Ministers and Central Bank Governors Meeting, Davos Forum, IMF and OECD suggest tackling income inequality as a key priority. However, the Park Geun-hye government is taking an opposite direction and all of its policies are focusing on giving privilege to the conglomerates and stimulating the real estate market, which would result in the institutionalization of restructuring, decreases in wages and the expansion of employment insecurity.
Comprehensive Measures for Non-Regular Workers, which is a major part of the ‘labour market reform plan’ and claimed by the government as a solution to various problems with so-called ‘dual structure of labour market, is in fact a comprehensive neoliberal labour policy attacking wages, employment and trade union rights of all workers. Using the above mentioned title, the government is laying the blame on the ‘over-protected regular workers’ or ‘vested interests of organized workers’, instead of the ‘inheritance and unequal distribution of wealth by the conglomerates’ for the income & social inequality.
Key points of the government led ‘Labour-Market Reform.'
In the New Year’s address of 2015, President Park emphasized “Labour Market Reform is not optional but essential for the survival of Korean economy”. She also urged the “Special Committee on Structural Reforms of the Labour Market” in the Economic and Social Development Commission (ESCD) to agree on the government’ plan within March 2015. Without participation by the KCTU, the Special Committee [composed of FKTU, KEF and the government] were convened several times but failed to draw an agreed conclusion. Just a day after the FKTU walked out of the negotiation finding there is no point of compromise, the government announced that it will unilaterally pursue the retrogressive amendment of related labour laws in the interim session of the National Assembly in April. Moreover, the Ministry of Employment and Labour declared that it will push for a variety of guidelines for collective bargaining, enforcement decree of the laws, and directives in order to accomplish the plan at every workplace. This shows that the government had no intention to listen to the workers' voice from the beginning.
In Korea, the right to strike is guaranteed by the Constitution. However, in practice, as the purposes, methods, procedure, and subject are excessively regulated, it is almost impossible for workers to strike legally. Union leaders and members quickly face criminal sanction, a lawsuit for compensation for damage, and disciplinary measures including dismissal. International support and solidarity have played a crucial role for Korean workers to exercise their fundamental rights.
What the government wants are easier dismissal, lower wage and more precarious jobs. The government-led labour market reform plan would deteriorate living and working conditions of all workers. It should not be promoted in any form.
The government is pushing ahead with the deterioration of the public pension system and activation of private pensions. The president herself failed to implement her election pledge to increase the benefit of Basic Old-age Pension and has no policy to improve the National Pension System whose affiliate and benefit rates are too low. On the contrary, the government is promoting a deterioration of the Government Employees Pension Scheme under the pretense of ‘equity among difference pension systems’. This will exacerbate the situation of poverty and income inequality in old age. What government should do is an upward equalization of pension systems by increasing the benefits level of the National Pension System and Basic Old-age Pension. At the same time, it should be accountable for the stable funding as an employer of the public servants.
As of 2015, the statutory minimum wage is KRW 5,580 per hour (KRW 1,166,220 per month) which is even less than actual living cost of a single worker without dependents (KRW 1,506,179, as of May, 2014). The minimum wage that was applicable in 2014 (KRW 1,088,890 per month) was 41.1 percent of the regular wage of the regular workers in the workplace with 5 or more employees and 32.7 percent of the total wage. This is too little to meet the purpose of the minimum wage system- eradication of low paid group, reduction of wage disparity and improvement of the distribution system. It is the minimum safeguard for low-waged workers. KRW 10,000 of the minimum wage will contribute to economic growth and the original purpose of the minimum wage system.
The number of workers in workplaces with less than five employees is 3,480,000, accounting for 19.15 percent of the whole working population. The Labour Standards Act does not cover all of them. Precarious Workers including workers in the disguised employment relationship and indirect employment relationship are not able to exercise the right to organize and right to bargain collectively.***
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