The Ministry of Employment and Labor announced a draft enforcement decree for the Yellow Envelope Bill, sparking concerns over expanded separate bargaining rights for subcontractor unions. Starting next March, subcontracted workers can demand direct collective bargaining with parent companies. Critics warn this could lead to workplace confusion and increased burdens on businesses.
The Ministry of Employment and Labor announced a draft enforcement decree on Monday for amendments to Articles 2 and 3 of the Trade Union and Labor Relations Adjustment Act under the Yellow Envelope Bill, putting it up for public review. This move has raised concerns that it will greatly expand separate bargaining rights for subcontractor unions, potentially causing confusion at workplaces.
Under the existing law, separate bargaining units were acknowledged only in limited and exceptional cases. The new decree specifies criteria for splitting bargaining units based on job type, interests, and union characteristics. Since multiple unions were permitted in 2011, the single bargaining channel system has played a central role in minimizing labor-management conflict. However, the decree now allows subcontractor unions to claim separate bargaining more easily, citing broad reasons such as job differences, plant location, or variations in working conditions.
At Hyundai Motor, for example, more than 5,000 partner-company unions could theoretically file separate bargaining requests. Even if job groups are consolidated, differences in parts, factory lines, or work environments could support demands for splits. If direct talks between parent firms and subcontractor unions fail, regional labor commissions will decide on consolidation or division based on working conditions, employment types, and bargaining practices. Yet, the number of unions employers must negotiate with is likely to rise sharply.
Labor groups are calling for the complete abolition of the single bargaining channel system, deepening concerns. Employers warn that the system has already become ineffective. The weakening of unified bargaining will impose significant burdens on companies, including year-round negotiations with numerous unions, increased staffing, time, and cost pressures, as well as risks of inter-union conflict. The government must apply strict criteria when approving separate bargaining units to prevent disorder in labor-management relations.
The Labor Ministry argues that separate bargaining is intended to ensure meaningful negotiating power for subcontractor unions. But instability in industrial operations ultimately harms the public. The ministry bears a heavy responsibility to refine the rules carefully before implementation.