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Country Report for PSI- EASRAC

 

PSI-Korea Council

 

 

1. General Background

 

1) Political Landscape

 

□ The new President Lee Myung-bak was elected with the symbolic concept of neoliberalism, 'Small Government, Pro-business.' Right after he took office, his government had to face such a strong resistance from the public, which is exemplified by "Candlelit Vigil." Still, since the second half of 2008, the new administration has blocked and controlled critics against its policies by using public authority and has propelled conservative policies in every area.  

 

□ Backlashed by the public opinion, the administration nullified its Grand-canal Project, but instead, it is now developing the four major river rearrangement project which it calls "Korean version of New Deal." Further more, it has strengthened conservative education policies reflecting its concept of "Competition First." As part of the policies, it pressured the relevant agencies to revise some contents in the modern history part of history textbooks and continued full-fledged nationwide oppression against the national teachers' union. Worse more, the Ministry of Education, Science and Technology has encouraged right-wing conservative celebrities to offer special lecture sessions and circulated around public junior high and high schools video advertisements embellishing development dictatorship of 5th and 6th Republic Governments and Lifetime Presidency.  

□ In addition, the incumbent administration has pushed ahead with ill-conceived laws which are exemplified by laws about demonstration and assembly, internet censorship, media control, more power on the national intelligence agency, and merger/abolition of 13 past fact-finding committees. 

 

□ Currently, out of 299 seats of the National Assembly, majority of them(172 seats) are occupied by the ruling party, Grand National Party. Adding up other conservative political members and ideologically like-minded members, more than two thirds of the total are taken by conservatives.  

 

<Table 1> Negotiation Party in the National Assembly

Total

Grand National Party

Democratic Party

Group for Advancement and Creation

Non-negotiation Party

Pro-Park Geun-hye Alliance

Democratic Labor Party

Creative Korea Party

Independent Members

299

172

82

20

8

5

1

8

 

□ In terms of inter-Korean relations, the administration denies the policy stance of the previous leadership, provoking the North Korean regime and fortifying its hard stance against the North. The government even stated in public that its ultimate goal is to achieve the absorbtion unification by the free democratic system. Worse, it joined the state list supporting the North Korea Human Rights Resolution of the UN thereby internationalizing the anti-North confronting policy. At the national level as well, it set up a new special committee in charge of human rights issues of North Korea thereby making its confronting policies official.    

 

2) Candlelit Vigil and Movement for Democracy

 

□ The biggest event featuring the year 2008 is such a large scale candlelit vigil. The vigil started in Seoul and soon spreaded nationwide. The vigil lasted for 100 days and at its peak on June 10, whooping one million Koreans attended the vigil. The demonstration was the biggest ever in its scale since the 1987 demonstration for democracy and the longest in 20 years. The candlelit rally was triggered by the US beef import issues, but soon enough its nature was transformed to a demonstration against the whole neo-liberal policies set out by the new government. The most popular song in the demonstration starts with words citing the article 1 of the chapter 1 of the Constitution : "The Republic of Korea is a democratic republic, and every power comes from its citizens." Our agendas in the protest were about the US beef import, early classes in schools, medical service privatization, privatization of public services such as water, electricity and gas as well as the Grand-canal project which was the centerpiece of the presidential campaign promise. And those all issues were covered and raised among the public in the candlelit demonstration. 

 

□ The candlelit vigil was characterized mainly by voluntary attendance of ordinary citizens. It was not organized by a certain political or ideological group. What's more, the Citizens' Coalition against the US beef Import were joined by as many as 1800 civic groups. Even teenagers and young adults aged 20's, who are often seen as politically indifferent, proactively joined the protest. The candlelit demonstration, therefore, deserves to be called 'Voluntary-based Democratic Movement of People', which goes against neoliberal policies and the government that doesn't listen to its citizens' voices. During the vigil, citizens requested the KCTU(Korean Confederation of Trade Unions) to launch a militant general strike, but the umbrella union failed to meet the level of demand from citizens. Instead, the KCTU actively joined the candlelit rallies by announcing 'political strike' to the public. The Union took initiatives in the struggles against stocking out the imported US beef from warehouses and beef distribution process. And those struggles sent the Chair Lee Seok-hang of the KCTU to jail.   

 

3) Economic Condition

 

□  The President Lee announced '747 Policy' during his presidential election campaign, which means the assurance of 7% of economic growth rate, 40,000 dollars of per capita GNP and 7th economic power in the world within ten years. For the growth rate goal in particular, he promised, he would proceed with policies on tax cut and bold deregulation thereby facilitating consumption and investment and ultimately reaching higher economic growth rate and employment rate. He also maintained his position supporting the concept of small government, economic pragmatism and minimum regulation, saying that such approaches will help promote social safety net and equal distribution of wealth at the end of the day.

 

□ The US-led global economic turbulence, which started from 2006, have been transmitted to the rest of the world, and Korea was no exception. As a result, the Korea economy gets worse and worse to the level of the 1997 financial crisis. Now, the economic growth rate forecast for 2008 was downgraded to 3.7% from the original 4.0%, and that led the projected annual rate to 4.5%.

 

□ The government prospects the 2009 economic growth rate down to 3% from the orignal 4%. Although the rate reflects the exacerbating global economy, it is still more positive than the projection of the Bank of Korea, economy research centers and the International Monetary Fund(IMF). The central bank of Korea and the World Bank forecast 2% of growth while 7 overseas investment banks, including Goldman Sachs and JP Morgan keep it at only 1.2%. 

 

□ According to the Korea National Statistical Office, the annual average of consumption prices for 2008 inflated up by 4.7% from the previous year. And that is twice higher increase, compared with the increase rate of 2.5% for 2007. The rate is the highest-ever since 7.5% of 1998 when the economy was under the bailout program by the IMF. Meanwhile, the Bank of Korea expects in its '2009 Economy Forecast' the price index to go up by 3% in 2009. 

 

□ As of September 2008, the official unemployment rate registers 3.0%, 722,000. Adding up the number of people who are unemployed actually such as discouraged workers and job seekers reach 3.17 million, accounting for 11.9% of the total population. 69 state-owned companies with 19,000 regular employees announced its downsize plan to cut over 10% of its labor, and irregular workers in particular who are not subject to the legal protection for dismissal are highly likely to be No. 1 victim of the restructuring process. 

 

 

2. Labor-Management Trend

 

1) Wage and Working Hours

□  As of third quarter of 2008, non-farm business sector companies with more than 5 regular employees increased its salary by 2.6%, averaged at 267.2 million won. Still, considering the 5.5% of inflation, the real wage actually dropped by 2.4%. And as of August 2008, the wage of irregular employees is only 49.9% of regular employees.'

 

□  Weekly working hours of overall employees averages at 39.5 hours (171.7 hours per month), which increased by 0.7 hours from the previous year.

 

2) Issues of Irregular Workers

 

□ The Act on Protection of Short-term and Termed workers entered into force from June 2007. The Act carries limits without meeting the demand of the labor community, yet it contains some contents stipulating that discriminations against termed workers is prohibited and termed workers who work for over two years get a position as a non-termed worker. 

 

□ Around 52% of the total labor population are irregular workers, and the number has continuously increased and reached 8.79 million in March 2007 from 7.36 million in August 2001. However, it started declining from August 2007 and as of August 2008, it recorded 8.4 million.

 

□ As such, the portion of regular workers increased while irregular workers decreased, and  there are three possible reasons behind the decrease: the protection act on termed workers made employers transform termed employees to non-termed or regular employees; employers replaced the irregular job positions with dispatched work positions or outsourced ones; or economic recession drove employers to dismiss reduce irregular workers.  

 

□ As for irregular workers, the social insurance application rate remains low. For example, for the national pension, only 33.2% of irregular workers join the pension program, while for the national health insurance sponsored by their companies, 35.5% and for employment insurance, only 33.5%.

 

□ Recently, the government set a plan to extend the current two year term of transforming the termed position to non-termed position to three to four years by meeting the request from employers' group. Still, the plan is now faced with a strong backlash by the labor groups.

 

3) Basic Labor Law and Labor Union Density

 

□ As the end of 2007, a total of 5,099 trade unions are registered. The number of union members records 16.88 million and density rate is 10%.

 

<Table 2> Trade Union Density

                      (Unit: 1,000, %)

 

‘00

‘01

‘02

‘03

'04

'05

'06

'07

No. of Trade Union

5,698

6,150

6,506

6,257

6,017

5,971

5,889

5,099

No. of Union Members

1,527

1,569

1,606

1,550

1,537

1,506

1,559

1,688

Union Density

12.0

12.0

11.6

11.0

10.6

10.3

10.3

10.8

 Source : Labor-Management Legal Issue Department, the Ministry of Labor

  

□ In accordance with the revised labor law, the dispute arbitration system was abolished as for the public service sector, and instead, an institution enforcing necessary service provision during strike was introduced. But the newly adopted institution restricts one of the basic labor rights, right to strike, in advance. The controversial institution preemptively blocks strike by stating triple restrictions as follows: violation against the institution shall be the subject to criminal punishment; 50% of substitute labor shall be permitted; relevant government agencies have an authority to stop strike when considered necessary.

 

□ The government has continued to make an undue interruption and unjustified      oppression against the KGEU(Korea Government Employees' Union), its membership and activities. Last July 22, the government indicted the KGEU to the Prosecutor's Office for its activities such as declaration against the order from the government about advertisements on the US beef negotiation and representatives' convention to discuss voting for the nonconfidence in the President Lee.  Worse more, the government organized police forces and blocked the national convention venue.  

 

□ After PSI-APRO hosted emergency workers' network in Dec. 2008, Korean fire fighters submitted an initiative requesting revision of the Government Employees' Union Law to ensure right to collective action of fire fighters to the National Assembly and have been developing activities to secure the basic labor rights. Meanwhile, as for the current law denying fire fighters' rights to union membership and activities, the Constitutional Court of Korea ruled that the law is not against the Constitution. Therefore, the struggle for revising the current law should be further accelerated. 

 

3. Activities of PSI Member Organizations

 

□ On the occasion of United Nations Public Service Day on June 23, PSI-KC announced the statement that points out problems of privatization and restructuring destructing the public nature of public services and that urges the government to take immediate actions for quality public services.  

 

□  The government announced in December the 4th comprehensive plan to advance public agencies of which centerpiece lies in 19,000 employees' lay-off, which amounts to 13% of the total employees. The administration argues that the plan is a part of the efforts to enhance efficiency of the public sector, but the plan is a severe violation against the labor rights of public sector workers, not to mention that it doesn't help revive the economy. Among OECD member countries, Korea ranks at the lowest in terms of the public sector's budget portion of the total GDP. Whenever leadership changes, the public sector has been reorganized under the name of lean management. Consequentially, most of public agencies suffer from lack of manpower which, in turn, brings about too high labor intensity. Given all the current situations, PSI-KC announced the statement which criticizes that such a random restructuring weakens the original function of the public agencies and even lowers the quality of public services.

 

□ Meanwhile, PSI-KC held serial discussion sessions titled " Whose Public Services? Are they for all or for just a few?" between 18th and 20th, Nov. The discussion sessions were venues to disclose all the negative impacts of neoliberal policies on livelihood of working families. Neoliberalism is the prime concept defining the new government, which propelled policies like medical sector privatization, public sector privatization, ill-conceived amendment of pension system and restructuring. The discussions also presented opportunities to seek alternatives against neoliberalism and to strengthen solidarity among workers.
 

Korea Government Employees' Union(KGEU)

 

□ Together with the Korean Teachers and Education Workers' Union(KTU) and other government employees' unions, the KGEU waged a million public servants and public sector workers' rally against ill-conceived amendment of the public servants pension act and for strengthening the public nature of public services. In the rally, with the two key goals, workers strongly requested the government to stop oppression on trade unions, to meet needs and demands from unions in negotiations, and to ensure the basic labor law. 

 

□ In addition, the KGEU held the 29th regular convention of union representatives on Dec 19. In the convention, they decided to proceed a union integration project and constituted the project team. The team, with the aim to launch an integrated union in May 2009, conducted a project to integrate individual public servants unions, the Korea Democracy Government Employees' Union, the Court Government Employees' Union and other individual government employees' unions into a single umbrella union.    

 

Korea Health and Medical Workers' Union(KHMU)

 

□ Meanwhile, from industry-based negotiations with the government which lasted for four months, KHMU drew significant agreements that states 4-5% of wage increase, 950,000 won of minimum wage, more wage increase in irregular jobs than in regular jobs, prohibition of the U.S. import beef use in hospitals and use of fresh local agricultural and ranch products. 

 

□ Meanwhile, KHMU conducted the election for 5th leadership members in early December, and the new leadership was elected with 92% of supports from the union voters. (Chairperson: Na Sun-ja, Senior; Vice-Chairperson: Lee Yong-gil; General Secretary : Yu Ji-hyun) The new leadership council starts their term from January 1, 2009 to the end of 2011. 

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