[Work Revolution] Conflicts Arising from the Introduction of Innovative Technologies and the Activation of Remote Work... Labor and Management Clash in Various Areas

Unfair Dismissal and Unfair Labor Practice Cases
Increase by 46.2% in the Last 3 Years
Corporate Management Worsens Due to This Year's COVID-19 Challenges
Leading to Employee Layoffs and Rising Disputes

[Asia Economy Reporter Jang Sehee] As changes occur throughout industrial society, labor-management disputes are gradually expanding. Conflicts between labor and management due to the introduction of 4th Industrial Revolution technologies and the activation of remote work are likely to continue in various places.

On the 24th, an analysis of the 'adjudication statistics' received from the Central Labor Relations Commission of the Ministry of Employment and Labor by Asia Economy showed that unfair dismissal and unfair labor practice cases have increased by 46.2% over the past three years. The number of adjudication cases (as of May) steadily increased from 4,571 in 2017 to 5,361 in 2018, 6,211 in 2019, and 6,684 in 2020. The overall annual trend also clearly showed an increase: 11,097 cases in 2017, 12,468 in 2018, and 14,958 in 2019.

The main cause is analyzed to be the sharp confrontation in labor-management relations due to changes in systems and labor forms such as the 52-hour workweek system and the extension of the flexible working hours unit period (currently 3 months). A Central Labor Relations Commission official explained, "There is a phenomenon where negotiations on wage increases, the scope of wage recognition, and welfare conditions are not proceeding well," adding, "It seems that the increased awareness of workers' rights has also had an impact."

This year, the number of disputes has further increased due to the unexpected adverse factor of the novel coronavirus disease (COVID-19). The worsening of corporate management due to COVID-19 → layoffs → labor-management disputes are linked. Since February, after the spread of COVID-19, the number of adjudication cases has exceeded 1,000 every month. Last month, it recorded as many as 1,314 cases, an increase of about 700 cases compared to the same period last year.

A representative (42) of a law firm in Seoul said, "Due to the impact of COVID-19, deficits have continued, and layoffs must follow, but temporary management difficulties are not recognized as urgent management needs, causing difficulties." According to the Labor Standards Act, if an employer intends to dismiss a worker for management reasons, urgent management needs must be recognized.

As COVID-19 prolongs, such disputes are expected to increase further. In fact, companies feel that the current management situation is more difficult than during the peak of COVID-19 in March and April. On the 21st, the Korea Chamber of Commerce and Industry conducted a survey titled 'Post-COVID Corporate Response Status and Policy Tasks' targeting 308 domestic manufacturers, where 45.2% of respondents answered that "the current business conditions have worsened compared to March and April." 46.3% responded that conditions are "similar to March and April," and only 8.5% said conditions have "improved." If corporate situations worsen further, disputes will inevitably increase accordingly.

In response, Choo Kwang-ho, Director of the Job Strategy Office at the Korea Economic Research Institute, said, "Current laws are mostly designed with traditional industrial labor forms in mind, so conflicts of interest between labor and management are inevitable," adding, "Labor rigidity must be eased so that both corporate investment and employment can revive." He further pointed out, "If the labor market remains as it is, young people newly entering society will inevitably face difficulties."