Problems of the Koreans laws concerning non-regular workers

by inter posted Jul 14, 2008


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In Korea, legislators have been very active in the CAL field over the last few years. They passed two laws (the act for fixed-term workers & part-time workers and the act for agency workers) to solve the problems of job insecurity and discrimination against CAL workers. But, the result was the contrary of the intention. 

According to the two laws, the period to use CAL workers should be limited to 2 years and then the workers with more 2-year service shall be hired as regular workers. Unfortunately, the laws only stipulates the period to use CAL workers, not the reason to use them (this means that the laws try to restrict the period of use, not the reason of use). Also, the laws shall be applied only to the CAL workers who are directly employed by principal company. These limitations in the laws have resulted in negative impacts on the CAL workers, since the two laws took effective on 1 July, 2007. 

The first negative impact is that employers tend to terminate the labour contract with the CAL workers before the two year. For example, the labour contracts of the CAL workers are over in 22 or 23 months and then they are "legally" replaced with other CAL workers. This case happened in manufacturing sector. 

The second negative impact is that employers tend to outsource the departments or lines (where the CAL workers do their jobs) to contractors and cut their relationship of direct employement from the CAL workers, who will do the same jobs in the same workplace, but hired by different employer (contractor). This case happened to cahiers in big supermarket. 

Also, it is noted that though employers hire the CAL worker with more 2-year service as regular workers, there are still problems in terms of discrimination. In this case, usually, employers create a new job category and dispatch the CAL workers to this new lines or departments which have diffent standards of promotion and wage on the basis of "No-fixed-term" contract. This case happened in banking sector. 

Around the time legislators debated the laws in 2006, trade unions and labour party warned that the above-mentioned problems would happen. 
In the early 2007, the Korean Employers Federation (KEF) investigated the attitude of employers on the laws. 80 percent of respondents answered that he or she would hire new CAL workers in every two year. 

The intent of the laws to protect CAL workers was good. But, employers neglected the intent and the laws have proved to be ineffective in protecting CAL workers.
It is noted that, at the moment, another employer association strongly demand to expand the period to use CAL workers from 2 years to 3 years.