[Editorial] Two Examples of Labor Peace

The union leader of the leading Korean textile company Kolon visited a Japanese corporate customer Monday and delivered a letter guaranteeing the quality of Kolon-made products. He had earlier sent letters to some 130 clients with the union’s pledge to meet product delivery dates. Last year, Kolon saw sales revenue grow 30 percent and operating profit rise 43 percent year-on-year. The company attributes the good performance to its business restructuring based on labor peace, though a stronger U.S. dollar has padded revenues through foreign exchange gains. Hyundai Heavy Industries signed an agreement with its union Monday on guaranteeing job security over the next three years. The measure was the Hyundai president’s response to the union’s decision to leave this year’s wage adjustment to management.

The Kolon and Hyundai unions were once very militant when under the Korea Confederation of Labor Unions, one of Korea’s two largest umbrella unions. In 2006, 95 percent of Kolon union members voted to secede from the confederation after two years of strikes. The Hyundai union, also known for its extreme militancy before, was forced out of the umbrella union in 2004 after opposing the confederation’s “political struggle.” Free from the confederation’s militant guidelines, the two unions achieved labor peace to secure more profits or jobs.

Even at a time of economic depression and a shrinking job market, the confederation is blocking efforts to protect job security through labor peace. Unlike the less militant Federation of Korean Trade Unions, the confederation did not join a compromise made by labor, management and the government. When the union of Yungjin Pharmaceutical decided last month to freeze wages and postpone collective bargaining until the company returns to financial stability, the confederation meddled by threatening to take disciplinary action against the Yungjin union.

The Korean Metal Workers Union under the confederation distributed to unions under it posters blasting the Hyundai union as a conveyer of management’s demands to its members. The confederation had the metal workers union do this to prevent the atmosphere of labor peace from spreading to other workplaces. Wage cuts aimed at creating more jobs are spreading nationwide, but the confederation wants wage hikes of 5.9 percent for regular workers and 20.8 percent for non-regular workers, while banning all layoffs. This demand is so anachronistic. The labor peace achieved by the Kolon and Hyundai unions needs to serve as a lesson for the confederation.