The Ministry of Employment and Labor(MOEL) on September 25 rescinded the two administrative guidelines; one on the "fair personnel management(general dismissals)" which allowed the employers to terminate the poorly performed employees and the other on the "employment rules and its operation" which also allowed the employers to introduce the performance-based pay system and the wage-peak system without the agreement of the workers. The two administrative guidelines were the products of the labor reform driven by the impeached former President Park Geun-hye. It contained the intention of the Park Geun-hye administration to reform the industrial relations and labor market in favor of the employers. The two guidelines were singled out as the deep-rooted evils in labor which the new Moon Jae-in government prioritized to rectify. The labor circle welcomed the government's move with the expectation that it will be a signal to start the cleaning-up of the deep-rooted evils in labor.
Employment and Labor Minister Kim Young-joo convened a meeting for the chiefs of regional employment and labor offices and affiliated institutions on September 25 at the Government Complex-Sejong and said, "As of today, the ministry rescinds the two guidelines". Minister Kim pointed out that "The consensus was not fully formulated about the necessity and contents of the guidelines during the preparation process. The hasty announcement of the guidelines by the previous government caused the Federation of Korean Trade Unions(FKTU) to pull back their participation in the Economic and Social Development Commission and the conflicts between labor and government". The imposed guidelines triggered the resistance of the labor circle from the very beginning of the implementation. It caused serious conflicts between labor and management at the workplaces, as the previous government pushed to introduce the administrative guidelines to lax the legally binding legitimate conditions on the dismissals and changes in employment rules.
The "fair personnel management" guideline was used as the weapon for the employers to terminate any employees whom they wanted. The targeted employees were transferred to other tasks where they were not able to perform fairly but to end up with poor performers. Then, they were sent to an education program under the name of the competency building called the peer intervention program(PIP) and the subsequent reassessments which turned out to be poor results in many cases that led to the termination by the employers or resignation by the workers themselves.
The "employment rules" guideline rendered the discretionary power to the employers who could introduce the wage peak system and performance-based pay system and also bring changes to the working conditions in disadvantage of the workers. Last year, 80 of 254 public institutions and local public corporations that introduced the performance-based pay system changed the employment rules without the agreement between labor and management, but only through the decision by the board of directors meetings. Minister Kim said to the reporters after the meeting, "President Moon Jae-in used to make remarks a few times that 'the two guidelines are infringing the law', when he met with the labor organizations during the presidential election campaigns. The government guideline that allows the poorly performed employees to be terminated is in violation of the labor law".
What the performance-based pay system which was introduced based on the two guidelines for the public institutions was scrapped in June this year and the abrogation of the two guidelines this time is interpreted as a signal that the government may drive the move to clean up the deep-rooted evils in the labor field. The government calls for the weekly ceiling of 52 working hours including the extended working hours from the current 68 hours through the revision of the Labor Standards Act during the plenary session of the National Assembly this year. If the National Assembly fails to pass the revision bill of the Act, the MOEL is likely to abrogate the administrative interpretation on the limit of working hours on January 1 next year, which currently allows the weekly maximum of 68 working hours.
Minister Kim did not hide her expectation toward the revival of the social dialogue at the point of time that the two guidelines were rescinded. She said, "I am looking forward (this initiative to facilitate) the revival of the social dialogue for the sake of a 'society with respect to labor' which is the backbone of the new government".
The Korean Confederation of Trade Unions(KCTU) welcomed the abrogation of the two guidelines but drew the line as to its participation in the social dialogue. In the meantime, the Federation of Korean Trade Unions(FKTU) is reportedly mulling over its return to the social dialogue mechanism, on the condition that the social dialogue body should be reorganized, different from the present Economic and Social Development Commission. FKTU is scheduled to hold a press briefing on September 26 to unveil its position on the social dialogue.
reported by Bae Hye-jung
translated by Kim Sung-jin