Fair Trade Commission fines construction union 169 million KRW for forcing "no transactions with non-members" rule

The Fair Trade Commission decided to issue a corrective order and impose a fine of 169 million KRW on the Busan branch of the Korean Confederation of Trade Unions (KCTU) Construction Union for forcing construction companies not to deal with non-union members. It also decided to issue a corrective order to the Ulleung branch of the Daegu-Gyeongbuk branch of the Construction Union, which unilaterally set the rental rates for construction machinery for union members.

On the 30th, the Fair Trade Commission issued a corrective order against the Busan Construction Machinery Branch of the KCTU National Construction Workers' Union for ordering withdrawal against the will of union members at construction sites in the Busan area. It also decided to impose a corrective order and a fine of 169 million KRW for forcing construction companies to refuse transactions with non-union members. The Fair Trade Commission stated that the business association status of the Construction Union was recognized at the plenary meeting last December.

Since August 2019, the Busan branch of the Construction Union repeatedly demanded the complainant, who had contracted with a construction company for forklift services at the Bukhang Opera House construction site in Busan, to stop work and withdraw. At that time, the Busan branch unilaterally deployed union executives to the site based on an internal rule stating that “if a union member operates at two sites, one of the sites is managed by the forklift branch affiliated with the union branch.” The Fair Trade Commission viewed such actions as excessively restricting the business activities of constituent businesses.

The Busan branch of the Construction Union also blocked sites to prevent construction companies from dealing with non-union members. They refused ready-mixed concrete transportation and halted the operation of union members' construction machinery at other construction sites managed by Seohee Construction. As a result, construction companies, fearing damage, accepted the Busan branch’s demands and terminated contracts with non-union members. The Fair Trade Commission regarded these actions as restricting the freedom of construction companies to choose their business partners and as acts of coercing refusal to transact with non-constituent businesses.

The Ulleung branch of the Construction Union also set rental rates for construction machinery, notified union members, and distributed the rate tables to construction companies and the Ulleung County Office within Ulleungdo. The Fair Trade Commission judged this as an act of restricting price competition among businesses. The Commission stated, “Organizations formed by construction machinery rental businesses to promote mutual interests are business associations under the Fair Trade Act,” and added, “If the same illegal acts occur in the construction machinery rental market, we plan to strictly sanction by filing complaints for non-compliance with corrective orders.”