The Gyeongbuk Regional Labor Relations Commission on the 8th recognized POSCO's "employer status" over subcontractor workers and approved the separate bargaining unit application filed by multiple unions. Following the recognition of employer status for public institutions on the 2nd of this month after the Yellow Envelope Law (amendments to Articles 2 and 3 of the Trade Union Act) took effect, this marks the first time both employer status and separate union bargaining have been permitted for a major corporation, raising concerns about growing confusion at industrial sites. The regional labor commission stated that "POSCO is recognized as an employer that can substantially control and determine industrial safety bargaining issues." POSCO, which experienced frequent industrial accidents last year, had strengthened safety management in consideration of the Serious Accidents Punishment Act—but this has now come back as a direct hit from the Yellow Envelope Law. The recognition of employer status over subcontractors ultimately leads to split bargaining with multiple unions, putting POSCO in a position where it must negotiate not only with its primary contractor but also with three subcontractor unions.
POSCO's subcontractor unions are currently divided between the Korean Confederation of Trade Unions (KCTU) and the Federation of Korean Trade Unions (FKTU). The KCTU's Korean Metal Workers' Union applied for separate bargaining apart from the FKTU's Korea Metal Workers' Federation and the KCTU's Plant Workers' Union. Consequently, this decision is likely to trigger a wave of individual bargaining demands from workplaces with multiple unions. Notably, the ruling accepted the subcontractor union's argument that separate bargaining was necessary because conflicts between the two major labor federations made unified bargaining difficult. That union-versus-union conflict was recognized as grounds for separate bargaining is a difficult point to accept. Furthermore, if existing employees strongly oppose POSCO's announcement the previous day to directly hire 7,000 subcontractor workers, the confusion could escalate further.
With labor authorities recognizing POSCO's control over subcontractors, the Yellow Envelope Law—now one month since taking effect—faces suspicion that its employer status provisions operate only in favor of unions. Without clear standards for the scope of "substantial and specific control," the reality is that subcontractor unions' bargaining demands are running rampant. In fact, since the law took effect on the 10th of last month, 985 subcontractor unions have demanded bargaining, yet not a single negotiation has actually begun. With domestic companies already embroiled in Middle East risks, if uncertainty from the Yellow Envelope Law compounds the situation, investment contraction and employment reduction could worsen further. Even now, work must be expedited to specify legal standards for employer status and prepare detailed guidelines that reflect industry-specific characteristics and contract structures.