Opinion Leaders` Digest 03-18
Date : June 16, 2003
Author : Nam Sung-Il, Professor, Dept of Economics, Sogang University sina@mail.sogang.ac.kr

Industrial labor union - its problem

   Recently, demand and trend to organize industrial labor union are growing stronger and more intense than ever, now under the Roh MH administration. Industrial union would be bigger in its size and more nation-wide in its dimension, to degrade the corporate unions merely to its local chapters. Collective bargaining would be done between the nation- wide industrial unions and the nation-wide employers associations or individual employers. Korea Health & Medical Workers Union and Korea Teachers Union are good examples of the industrial union in Korea.

The industrial unionist argues three favorable points, as follows.

First, industrial union would enhance the number of the unionized laborers, including temporary workers. Current corporate union covers only 12% of total workers.

Second, the industrial unionization would be surely able to strengthen political influence of the labor union, able to perform nation-wide strike as well as intensified strikes against particular corporates. Political activities of the union coupled with nation-wide capacity of united collective actions would build up its political image as well.

Third, industrial unionization would contribute to remove the different levels of treatment and position of workers, as the wages and working conditions would be decided through the negotiations by the industrial unions.

Worker`s right is granted and established as a sort of defensive or protective device against possible unfair practices by the employers. In the arena of the small and medium industries, workers are not much eager for labor union, as both of labors and employers would have reached a consensus of opinion that the labor union would build no advantage to both of them and would make their position rather worse on the contrary. Experience of Europe illustrates us that it was very difficult job to unionize the temporary workers, even though the industrial union abounds in Europe.

In conclusion, it is most likely that industrial unionist would drive to build up their political influences by integrating the existing corporate unions into industrial ones, without regard to the protection of the worker`s rights and interests. The case is well illustrated by the recent actions by the Korea Teachers Union.

The author argues that the industrial union would not be an epoch-making solution in the enormous gap in the working conditions between the conglomerates and small and medium, as the gap arises as the wages of the conglomerates have been sharply raised at the unreasonable demand by the unions and its burden is shifted to the small and medium industries.

Organization of the industrial unions would run against current international tendency. The realism of the market, far from the ideological design, is changing toward an accelerated competition among the corporates due to the development of technologies and communications to remove national barrier of the economy. Now legal deregulation in support of more flexible labor market is a global tendency replacing the rigid labor laws demanding uniform working conditions within territory of a nation. In short, labor union is being decentralized. Industrial union in Europe is losing its influential. But industrial unionists must have indulged in an anachronism.

Centralized industrial unionism, running against market tendency of decentralization, would have a variety of harmful effects on our economy- society.

First, job opportunities will be diminished as small and medium industries would shut down or shift their production to overseas, as they would not be able to cover the too heavy and uniform demands by the unions. The conglomerates would lose its competitive edges with deepening rigidity and failure of human resource management. New graduates from schools would the most serious sufferers.

Second, frequent and habitual labor disputes will damage the resourceful potentiality of the national economy. Ultimate target of the industrial unionist is to change the decision-making system of the economy with wider and stronger political influence. This means first step to destruction of the market economy.

Third, labor-management relations will fade away from the work sites of corporate, making it more complicated to handle. Axis or backbone of labor-management relations would be shifted to the headquarters of the industrial union and associations of the employers. Accordingly, problems between labor union and corporate would be in peril of being neglected and the union members would lose their own rights and have to bear heavier burden of increased union fees.

In many a country, these days, the frame of labor- management relation is evolving in the direction of decentralization and flexibility, responding to the change of economic environment. The author concludes that we ought to sacrifice group egoism and to keep pace with global standard as we are facing a change of economic environment, which other countries are facing as well.

(July 4, 2003 summarized and re-edited by JUNG Churle, a CFE Research Fellow, jungchrl@unitel.co.kr. Some changes have been made in wordings by good advices from the author)