Time for Plan B

The three-way negotiations between labor, management and the government to reform our antiquated labor market have ended with no tangible results. The Federation of Korean Trade Unions (FKTU), which represents the labor sector, declared a breakdown of the meeting Wednesday as “it cannot accept easy dismissal of employees, disadvantageous modification of employment rules and proliferation of non-salaried workers in the labor market.” The FKTU said it is not responsible for continuing the negotiations if they make no progress. With that pronouncement, the six-month bargaining for a grand consensus came to an end.

The negotiations fell apart because all three parties adhered to the protection of their vested interests rather than joining hands for co-prosperity. The FKTU at the last minute expressed vehement opposition to the following ideas: of extending employment terms for non-salaried workers and expanding the scope of jobs for workers dispatched by contractors; extending the retirement age and enforcing a so-called peak salary system; revamping the current wages systems; and a modification of rules on employment and dismissals.

Labor didn’t budge on any of five proposals by management. The corporate sector also was bent on the changes it was seeking, in particular, easing requirements for firing workers. The government made it worse by legislating a later retirement age without considering how well the corporate world was prepared for it. To make things even worse, the administration demonstrated poor leadership and failed to coordinate views of several ministries.

The government now is left with Plan B: establishing laws and systems after reviewing the near-agreements between the labor and management. Even though strong resistance is expected from labor, the government must fix pressing issues such as changes of wage systems and cutting working hours. If the retirement age is extended without changing those, the labor market will be more calcified around existing regular union members, which will lead to more intensified conflict between generations and classes. The employment rates of the young in Spain and Italy, which both failed to achieve grand consensuses on labor reform, are less than 20 percent. If our government and other parties fail to reform ours, a dark shadow will fall on the future of our young generation.

The government must press ahead with Plan B. The National Assembly must not repeat its bad practices of intensifying schisms. What counts most is a spirit of compromise.

JoongAng Ilbo, April 9, Page 30