The Korea Employers Federation (KEF) on Wednesday criticized the National Labor Relations Commission's decision to halt mediation in disputes between subcontractor unions and their principal employers Hyundai Steel (004020.KS) and Hanwha Ocean (042660.KS), saying the ruling "will have a very negative impact on labor relations between principal and subcontractor companies."
The commission's decision to suspend mediation due to the wide gap between labor and management positions effectively grants the unions legal rights to stage strikes.
"The commission recognized labor dispute mediation by subcontractor unions against principal employers even though the revised Trade Union Act (Yellow Envelope Act) will not take effect for another two months and the enforcement decree is still under public notice," KEF said in a statement. "The commission's hasty mediation suspension has undermined judicial stability."
KEF noted that legal disputes over whether Hyundai Steel and Hanwha Ocean qualify as employers for collective bargaining with subcontractor unions remain ongoing, with the labor commission itself having issued conflicting rulings on the matter.
"The question of employer status should be determined through final court rulings," KEF said.
The federation also argued that the decision "effectively nullifies the unified bargaining channel procedure," pointing out that when a representative union already exists at the principal employer level, separate collective bargaining requires formal separation of bargaining units.
"Neither Hyundai Steel nor Hanwha Ocean underwent such separation, meaning the subcontractor unions cannot be legitimate parties to mediation requests," KEF said.
KEF expressed particular concern over the timing of the decision, which came as the government is proceeding with follow-up measures to the revised Trade Union Act, including public notices for amendments to the enforcement decree and interpretation guidelines.
"The commission's unreasonable decision raises doubts about fair judgment and will significantly reduce corporate acceptance," KEF said. "The commission must not repeat such unreasonable decisions that accommodate only one party's demands."
