[Viewpoint] Considering the Yellow Envelope Law Ten Years from Now

In September 2035, Jaldallyeomotors, once a leading South Korean automobile company, announced its withdrawal from the Korean market. The company had long suffered from a series of strikes by subcontractor unions. After the so-called "Yellow Envelope Law" passed the National Assembly in 2025, more than 100 subcontractor unions demanded labor negotiations with the parent company. While many subcontractor unions unified their negotiation channels, some insisted on negotiating directly and independently with Jaldallyeomotors. As a result, the company was forced to engage in labor negotiations with subcontractor unions throughout the year. Whenever negotiations stalled, strikes would occur. The management of the subcontractors became powerless. During this period, Jaldallyeomotors severed business ties with over 20 subcontractors that were experiencing severe labor disputes and established new relationships with other subcontractors. Employees of the subcontractors who lost their contracts filed lawsuits, claiming the terminations were unfair. After a lengthy legal battle, the court ruled in favor of the subcontractor unions.

Over the past ten years, Jaldallyeomotors' price competitiveness sharply declined as it raised wages for subcontractor workers. In the United States, which had previously been a key market, the company's vehicles no longer sold as they once did due to U.S. protectionist policies and tariffs prioritizing domestic industries. Meanwhile, Chinese automakers continued to innovate technologically, surpassing not only Korean but also Japanese and German cars. As Jaldallyeomotors lost ground in overseas markets, its operating profit turned to a deficit, and its stock price plummeted repeatedly. The company's management stated, "It has become nearly impossible to focus on management due to constant labor disputes," and explained, "We will close our Korean factories and expand our U.S. operations." In response, both the company's own union and the subcontractor unions launched another strike. However, the management maintained, "When the Yellow Envelope Law was introduced, we warned that it would erode corporate competitiveness and eventually make it impossible for companies to survive, but the politicians who passed the law did not listen," adding, "There is no reason for us to remain in Korea, regardless of the losses we may incur."

This article imagines the worst-case scenario that the Yellow Envelope Law (the amended Trade Union and Labor Relations Adjustment Act) could bring about ten years from now. Can we be certain that such a situation will never occur? Among companies producing automobiles in Korea, foreign firms such as GM Korea and Renault Korea are always prepared to withdraw from Korea if the business environment deteriorates. Recently, the American Chamber of Commerce in Korea (AMCHAM) warned that if the Yellow Envelope Law is implemented, investment by American companies in Korea could drop sharply. The European Chamber of Commerce in Korea (ECCK) also demanded a review of the law, warning that European companies might withdraw from the Korean market.

Many people are aware that the Yellow Envelope Law is a legacy of the SsangYong Motor strike incident. The brutal scenes from the SsangYong strike remain a deep wound for the labor community. There is broad consensus that excessive damage claims and provisional seizures against union leaders should be prevented. For this reason, if labor, management, and government come together, there is sufficient common ground for agreement.

A different approach is needed to improve the treatment of subcontractor workers. It is difficult to resolve the issue by making parent companies responsible for the employment conditions of subcontractors. A discussion about transforming the employment system is necessary.

The ruling Democratic Party plans to submit the Yellow Envelope Law to the extraordinary session of the National Assembly starting on the 21st. For the Lee Jaemyung administration to usher in the era of "KOSPI 5000," strengthening corporate competitiveness and improving performance are essential. Now is the time to listen to the voices of business leaders again and again.