[Enemies of Reform⑩] "Must Serve the People, Not Unions... Need the Determination of Prime Minister Thatcher"

"The two major labor unions represent only 10% of all workers. Most small and medium-sized enterprises cannot even form unions. The new government should pursue labor reform by considering all citizens and workers, not just the unions."

Kim Jun-yong, Secretary General of the National Workers' Union (Gukmin Nojo) and former Secretary General of the National Council of Trade Unions (Jeonnopyeop), the predecessor of the Korean Confederation of Trade Unions (Minjunochong), said this in an interview with Asia Economy on the 16th. He pointed out that the current labor market structure is excessively concentrated on the two major unions, Minjunochong and the Federation of Korean Trade Unions (Korean Nojo), and emphasized the need for labor reform for general workers. 'Enemies of Reform'

Secretary General Kim said, "The labor sector is expected to strongly oppose the new government's labor reform. It is a time when strong reform determination like that of former UK Prime Minister Margaret Thatcher is needed." He agreed with the new government's labor reform directions such as flexible working hours and wage systems and differentiated minimum wage application by industry, diagnosing them as an inevitable process to keep up with changing industrial and labor structures.

Regarding the labor sector's continuous strong struggle stance, Secretary General Kim pointed out, "In the past, struggle and achievement were very important, but now tolerance, cooperation, and coexistence are more important," adding, "It is time for rational decision-making rather than ideologically overpowering the opponent."

Below is a Q&A with Secretary General Kim.

- The differentiated application of minimum wage by industry, promised by President Yoon Suk-yeol, was recently rejected by the Minimum Wage Commission.

▲ Differentiated application of minimum wage by industry is necessary. Among Korean companies, there are large companies like Samsung and one-person businesses. Their ability to pay wages is not the same. Especially, many self-employed people cannot afford to pay the minimum wage. Since Korea requires paying weekly holiday allowance if working more than 15 hours a week, raising the minimum wage to protect workers causes side effects such as reducing overall jobs and producing only poor short-term part-time jobs. On the other hand, public enterprises and large companies benefit as the minimum wage increase automatically raises wages of higher-ranking managers like section chiefs and department heads. The current minimum wage system is problematic because it pushes the MZ generation (Millennials + Generation Z), part-timers, and self-employed people to the limit while helping vested interests.

- The new government plans to change the wage system from seniority-based to job- and performance-based pay.

▲ This is a natural step. In the seniority system, wages automatically increase, so people in their late 50s receive high wages while new employees get very low wages. It is very unfair because they do not get paid according to their contribution. Only Japan and Korea still have seniority systems, but Japan is also almost changing. The public sector should change first. It is unreasonable that a good game company employee earns a billion won annually while a Grade 9 public official starts near minimum wage.

- Opposition from unions in the public sector and others is expected to be strong regarding wage system reform.

▲ Former UK Prime Minister Margaret Thatcher led the revival of the UK by boldly implementing reforms without yielding to the then-powerful coal miners' union. Korea also needs strong reform determination like Thatcher during these difficult times. Unions think that wages increase only if they fight with headbands on, but that structure must change. Recently, construction workers' wages rose significantly, but not because of struggle. When economic efficiency and productivity improve, creating more jobs and recruitment, wages rise.

- Is flexible working hours necessary?

▲ Korea's Labor Standards Act is suitable for the era when Charlie Chaplin worked in factories in the movie 'Modern Times.' Setting a uniform 52-hour workweek without exception shows no understanding of the current industrial system. For example, toy companies have peak seasons like Christmas and Children's Day. Labor and management should be allowed to agree flexibly. Some people have low productivity even working 8 hours a day, while others have high productivity working only two days a week. Everything should not be evaluated by the quantity (time) of labor.

- Minjunochong is expected to continue strong struggles under the Yoon Suk-yeol government.

▲ The Cargo Solidarity strike was a complete victory for Minjunochong in the first round. They are expected to continue strongly. In a situation where raw material prices and international oil prices rise due to the Ukraine war, if workers strike, the economy is paralyzed. They seem to pursue a strategy to corner the opponent (government and companies) to gain benefits. In the past, struggle, achievement, and labor rights were very important, but now, with a national income exceeding $35,000, tolerance, cooperation, coexistence, and consideration are important. It is an era requiring rational decision-making rather than ideologically overpowering the opponent to win.

- The Yoon Suk-yeol government has agreed on the time-off system and labor director system.

▲ Korean public officials and public enterprise employees are not poor or disadvantaged. Really struggling small and medium enterprises cannot even form unions for fear of company collapse. It is questionable why the state should support even full-time union officials of public officials with taxpayers' money through the time-off system. They have self-sustainability and organizational power even if left alone, so the state does not need to help much. Instead, the government should take care of self-employed people and workplaces with fewer than five employees that have no unions and are unrelated to the time-off or labor director systems.

- In what direction should the new government's labor reform be pursued?

▲ The two major unions represent only 10% of all workers. However, they decide most positions on important labor issues such as the minimum wage. The two major unions claim to protect vested labor interests and call it 'justice,' but it is not. The new government should pursue reform by looking at the majority of citizens and workers.