Thought the following interesting for what it says about the thinking of
large capital and the state in Korea on how to weather the crisis and
the response of the KCTU.
Marty
*
*
*KCTU Statement Opposing the Grand Agreement to Overcome the Economic
Crisis*
On February 23, 2009, the Federation of the Korean Trade Unions (FKTU)
and the Korea Employers Federation (KEF) announced the /Grand Agreement
to Overcome the Economic Crisis/. The crux of the Agreement is,
"workers will try to not go on strike and agree to a wage freeze or wage
cuts." The Korean Confederation of Trade Unions (KCTU) is very
disturbed by this Agreement, which we believe will further accelerate
the crisis rather than overcome it. This Agreement is completely in
line with the so-called "pro-business" policies of the current Lee Myung
Bak administration. There is nothing within the Agreement that contains
practical details to assist workers in alleviating the crisis; instead,
it appears that it is the workers who are actually "paying" to resolve
this crisis.
The?Emergency Meeting of Labor, Management, Civic Groups and the
Government to Overcome the Economic Crisis?(hereinafter referred to as
the "the Emergency Meeting") which was launched on February 3, 2009,
excluded progressive civil society groups and social movements including
the KCTU. The restrictive composition of the Emergency Meeting is
clearly indicative of the intention to propose an Agreement that is in
line with government policy that shifts the economic burden in resolving
the crisis to workers only.
This Agreement is an "illicit collusion" between the KEF, which has
argued for more labour flexibilization and minimum wage cuts and the
FKTU, which from the very beginning has supported the incumbent
government under the framework of "policy-solidarity." Since we believe
that the Agreement has no legitimacy or has the interest and concerns of
workers as it contains abstract and theoretical language that it is not
supported by any practical solutions or commitments. More importantly,
as stated earlier the Agreement has been designed to have the workers
"pay" for the crisis. Because of this, the KCTU cannot support this
Agreement.
The current economic crisis is not limited to only South Korea, but it
is a global one. Thus, we believe that we cannot overcome the crisis
through previous economic measures such as increasing exports. Instead,
we need to change the economic structure so that it is grounded more on
domestic demand. If we continue to implement previous policies of
"increasing exports" it will only result in greater social and economic
disaster. To avoid this, we believe that an increase in workers wages
will contribute to increasing their purchasing power which then would
lead to stimulation of domestic demand.
In particular, we support innovative proposals such as "job-sharing"
which we believe should be encouraged through reduction of work hours
rather than unilateral wage cuts. Furthermore, we believe that the
burden in resolving the economic crisis should be shared fairly among
all social partners; yet, the Agreement merely focuses on wage cuts and
contains no details as to the role and responsibilities of both
government and employers.
The Agreement argues for fair pain-sharing among employers and workers
but in reality, it forces workers to bear the whole economic burden by
freezing wages, wage cuts, and wage pay backs, while employers are
receiving various benefits such as tax incentives and government policy
funds. Moreover, the Agreement allows employers to pay shutdown
allowances to workers less than the legal standard. In short, the
government is basically encouraging violation of laws. In order to share
the "pain" in a fair and equitable way between employers and workers,
"job-preserving and sharing" should be done through a reduction of work
hours and at the same time, it is necessary for social partners to share
responsibilities fairly so as to preserve wage. However, the Agreement
recommends only unfair and unjust measures.
The KCTU urges the government to enact the "Special Act for Employment
Security", which will encourage various measures, in particular
reduction of working hours, for job-preserving and also urges the
employers to take immediate action to return the trillions of retained
earnings to society so as to share the economic burden. As of September,
2008, the retention rate of 10-largest corporations in South Korea is
787.13%(around 194 trillion Korean Won) and their liquid asset is
estimated as 42 trillion Won.
In addition, we have to pay attention to the Agreement to ensure that it
does not pardon the government for neo-liberal policies including
'failed' policy of neoliberal labour market flexiblization, minimum wage
cut and retrogressive reform of precarious workers act. The Agreement
will result in decreasing domestic demand and then subsequently
worsening the current crisis. It should be also pointed out that the
Agreement contains creation of precarious work by implementing
six-month, low-wage employment contracts in the construction of the
Korea Grand Canal, an infrastructure proposed by the government to
create jobs.
For the purpose of creating and sharing jobs, we urge the government to
stop the retrogressive reform of precarious workers act and minimum wage
act, stop the plan for construction of Korea Grand Canal, and take
urgent actions to create "decent jobs" in the public services and not
"precarious and low-wage jobs". Unfortunately, the Agreement fails to
contain any of these points. Because of this, we believe that the
Agreement provides a good excuse for the government to proceed with its
plan for retrogressive reform of precarious workers act and minimum wage
act.
Moreover, during the process in concluding the Agreement, the KCTU was
not only excluded from the discussions but more importantly was severely
repressed in an effort to isolate and exclude a key force within the
framework of industrial relations in South Korea. Thus, we cannot
accept the representativeness of participants in the Emergency Meeting
as reflecting the interests of workers in South Korea.
In conclusion, we do not believe that the Agreement can serve as a
momentum to overcome employment and economic crisis. Alternatively, KCTU
calls for the following:
1. Ensure decent work and living wages for workers and not wage cuts.
2. Take urgent measures to create, share, and preserve decent jobs
and not low-wage, precarious employment.
3. Take immediate measures to create decent jobs in area of public
services and environmental-friendly industries.
4. Stop tax reduction policy for the rich.
5. Build and strengthen social safety nets for the unemployed.
6. Introduce employment quota system for the youth.
7. Build universal safety net scheme for the whole ordinary people.
8. Stop the plan for retrogressive reform of Precarious Workers
Act and Minimum Wage Act, but strengthen support for precarious and low
wage workers.
Feb. 2009
Korean Confederation of Trade Unions (KCTU)* **?*
Lee Changgeun
International Executive Director
Korean Confederation of Trade Unions
Tel.: +82-2-2670-9234 Fax: +82-2-2635-1134
E-mail: [email protected] Web-site : http://kctu.org
2nd Fl. Daeyoung Bld., 139 Youngdeungpo-2-ga, Youngdeungpo-ku, Seoul
150-032 Korea
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