Labor union subsidies often used for non-labor purposes

Union members of the Korean Construction Workers' Union hold a rally on Sejong-daero in central Seoul on Tuesday. [YONHAP]

Over 90 percent of government grants provided to labor groups poured into Korea’s two largest trade unions — the Federation of Korean Trade Unions (FKTU) and the Korean Confederation of Trade Unions (KCTU). Of these subsidies, 20 percent, or 700 million won ($524,000), was found to have been used for programs seemingly unrelated to their labor rights-supporting objective.

Of the 3.51 billion won subsidies provided to labor groups last year, 92.8 percent, or 3.26 billion won, were given to the FKTU and KCTU, according to funding data between the years 2019 and 2023 submitted to the office of People Power Party Rep. Lee Joo-hwan on Monday. The FKTU and its 14 affiliate unions received 2.93 billion won, and the KCTU’s affiliates received 331 million won.

The FKTU’s head office was granted 2.63 billion won, the most among all trade unions. It spent 1.48 billion won on getting legal aid counseling for laborers.

The FKTU and KCTU have raked in the most government subsidies in the past years. The two organizations picked up 91.6 percent of all trade union subsidies in 2019, 88.9 percent in 2020 and 88.7 percent in 2021. FKTU and KCTU union members make up more than 80 percent of all 2.93 million union members in Korea.

Nearly 700 million won was used last year for international exchange and staff training, or activities distant from the worker-supporting purpose of the subsidies.

The FKTU spent 136 billion won on international exchange programs. The trade union reported that the money was used for overseas activities such as participating in International Labour Organization conferences but did not disclose detailed usage of the budget.

The FKTU also received 513 million won for executive training. The Education Union Korea, an affiliate of FKTU, had a staff training seminar in Jeju Island for three days on a 15-million-won budget, which included recreational events such as a cruise tour and foot spa.

“Trade unions may need a budget for international exchange and staff training, but it’s inappropriate to supply such activities with government subsidies,” an official from the Labor Ministry said.

The Yoon Suk Yeol administration pledged to reform the preponderant provision of labor group subsidies, and the Labor Ministry in February announced that it will implement a more thorough scrutiny of the aid provisions going forward. Trade unions are now required to submit evidence materials on budget execution and a detailed accounting report to the ministry, which will be reviewed by an accounting firm.

The government in April announced the first selection of trade unions entitled to government grants, which did not include FKTU’s head office for failing to submit a transparent accounting record. The Labor Ministry said unions that fulfill their legal responsibilities will be eligible for the aid in the second round of selections scheduled for mid-May.

Of the 826 million won administered as aid for the first group of finalists this year, FKTU and KCTU affiliates accounted for 34.2 percent of the whole, or 283 million won. Eleven relatively smaller trade unions returned to the list.

BY NA SANG-HYEON,SOHN DONG-JOO [sohn.dongjoo@joongang.co.kr]