Behind the scene agreement fostered power of railway union

Korea Railway is known to have guaranteed its employees be promoted to senior manager rank once they meet required working years even if they make serious mistakes to harm the firm. Also, it can`t reassign employees who do not want to other areas by force. Korea Railway`s presidents elected by preferential treatment calmed the labor union who has powerful authority through a hidden agreement of providing such drastic favors. Suffering from ballooning debt and deficit, Korea Railway is criticism as being a joint work between management and labor.

According to the Land and Transport Ministry and Korea Railway on Wednesday, the latter promised automatic promotion based on years of service and restriction of forced transference in 2005. Then CEO Lee Chul provided such "carrots" ahead of strikes by female cabin attendants of KTX to lower demonstration participation by the railway labor union. This was later reflected on collective negotiations.

Automatic promotion based on years of service refers to guaranteeing employees to be promoted to senior manager level even if they join illegal strikes or make serious railway accidents. Accordingly, Korea Railway employees (college graduates) get to be senior managers after 24 years of continued service. Senior manager position refers to middle managers including stationmasters, passenger conductors, etc. A ministry officer said, "Korea Railway employees can be promoted to middle-manager level even if they join illegal strikes or commit serious railway accidents, if they are not dismissed. This is a favor not found in other state-owned companies."

A Korea Railway source said, "The so-called parachute CEOs made behind the scene agreement providing various favors to prevent strikes of militant labor union," adding, "These measures caused lax management of Korea Railroad."