[EDITORIALS]Impact of revised labor laws

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[EDITORIALS]Impact of revised labor laws

The governing party agreed to pass a bill next month at the general session of the National Assembly that involves protecting irregular workers. This bill was triggered by the employment scandal at Kia Motor. It is aimed at increasing the number of available jobs by increasing the flexibility of the labor market.
Currently, irregular workers make up 37 percent of all workers, and their numbers increase each year by about 800,000. Their wages, however, are only 60 to 65 percent of those of regular workers, and they cannot receive social insurance benefits. Problems regarding contract jobs have become a detonator for social conflict.
The domestic labor market is divided largely into two sections: regular workers in large companies and irregular workers.
The former is practically impossible to adjust, while the latter is overly flexible. It goes without saying that the “rigid” market should be loosened and the weak one supplemented.
In this sense, protecting contract workers by the law and “correcting” discriminative wages and work conditions seems to be a desirable solution. However, unintended events can happen in this process. Companies will have heavier burdens because they have to protect contract workers.
For instance, Hyundai Motor’s labor costs will go up by 150 billion won ($142 million) annually if it converts its 8,000 contract workers to regular workers. The solution, therefore, should focus on how to make employment of regular workers more flexible rather than simply converting irregular workers to regular workers.
These circumstances are bringing protests from labor circles. The Korean Federation of Trade Unions has warned that it will go on a full strike if the bill is passed. The Kia case shows how regular workers in the labor union made money off irregular workers, when in fact, they should have been the first ones to compromise.
Companies also have to change their way of thinking. Up to now, irregular workers were the first to lose their jobs in times of depression because they were easy to fire. This happened with the tacit consent of the labor union for regular workers.
These customs must be discontinued. To minimize the shock of the effect that the new law will have on financial and labor circles, the government must first put its head together with labor and management.
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