Union Official in Daegu Region Arrested for Embezzling 130 Million Won from 11 Construction Companies

Refusal to Hire Union Members Leads to Rally

Threats Over Reporting Construction Site Safety Issues

On the 29th, the Daegu Western Police Station arrested union executive A on charges of extortion for taking approximately 130 million won from 11 specialized construction companies.

According to the police, from January 2021 to June 2022, at 16 apartment construction sites in the Daegu and Gyeongbuk areas (10 in Daegu, 6 in Gyeongbuk), A demanded the hiring of union members from specialized construction companies. When these demands were refused, A threatened to disrupt construction by holding rallies at the sites or by reporting issues related to site safety, environment, and foreign workers. Subsequently, A is accused of extorting about 130 million won under the pretexts of union full-time fees and development funds.

Daegu Police Agency.

Police investigations revealed that construction companies, fearing extended construction periods and greater losses due to union power plays, as well as disadvantages in bidding and contracts caused by reports, succumbed to the threats and paid the money.

After receiving intelligence in January that a false collective agreement had been created and union full-time fees were being paid, the police launched an investigation. They secured key evidence to prove the charges, arrested the suspect, and plan to expand the investigation to determine if there are more victim companies.

Union full-time fees are payments made to union members who work exclusively on union duties, also called ‘wage negotiation fees’ or ‘time-off fees.’ Development funds refer to amounts demanded as compensation when requests to hire union members at sites were refused, also known as ‘encouragement funds.’

From December last year to the 27th of this month, the Daegu Police Agency conducted a ‘Special Crackdown on Violent Acts at Construction Sites,’ resulting in 93 people being booked in 23 cases, with 2 arrests.

The police stated that they will continue to strictly investigate illegal acts that undermine fairness at construction sites, such as ‘obstruction of business,’ ‘violence,’ ‘extortion,’ and ‘coercion to hire or use construction machinery,’ which demonstrate collective power.