The opposition bloc’s resounding victory in the general elections on Wednesday will weigh on companies that have been wishing for labor reforms, tax incentives and eased regulations in the 22nd National Assembly, experts said Thursday.With over 190 seats out of 300, the main opposition Democratic Party of Korea (DPK) and minor opposition parties are expected to put the brakes on the Yoon Suk Yeol administration’s policies, which have been regarded as favorable to business and hostile to labor.“The government’s efforts to revise the Serious Accidents Punishment Act (SAPA) lost momentum,” said lawyer Oh Tae-hwan, a partner at law firm Yoon & Yang whose main practice areas are employment, labor and disputes regarding industrial accidents. “The only option for the president will be modifying the enforcement decree.”The law, which took effect in January 2022, states that a company’s CEO can be sent to jail if a serious worksite accident occurs when the company has not taken sufficient safety precautions.After companies with fewer than 50 employees became subject to the law in January this year following a two-year grade period, small and medium-sized enterprises (SMEs) have asked for an additional grace period, filing a constitutional petition.
“The 22nd National Assembly should abolish unreasonable environmental and labor regulations,” the Korea Federation of SMEs said in a statement, Wednesday. “The 21st National Assembly should immediately grant an additional grace period on the SAPA for companies with fewer than 50 employees and pass bills to invigorate the economy.”However, the DPK decided in February to reject the government and the ruling party’s request to grant an additional grace period for SMEs.“Revisions of laws will completely depend on the opposition party’s decisions,” Oh said. The lawyer also said that the opposition bloc will once again try to revise the Trade Union and Labor Relations Adjustment Act as it promised, because the president rejected the proposed bill, dubbed the “yellow envelope law.”The opposition bloc proposed the revision several times, after yellow envelopes with money were delivered in 2014 to support unionized workers ordered by a court to pay a combined 4.7 billion won ($3.4 million) to SsangYong Motor in compensation for their strike in 2009.The proposed bill allows subcontracted workers to negotiate directly with their employers’ clients, even though the clients do not employ those workers directly. It also justifies strikes by subcontracted workers against their employers’ clients and bans management from demanding compensation for damage caused during illegal strikes, unless they assess the damage caused by each individual.
Korea’s two largest umbrella unions said Thursday that the election outcome proved the public anger against the president’s indiscriminate vetoes on pro-labor bills.“The Supreme Court will soon conclude whether subcontracted workers have the right to negotiate with their employers’ clients, when making a ruling on the lawsuit between HD Hyundai Heavy Industries and the Korean Metal Workers’ Union,” Oh said. “If the court rules in favor of workers, this will justify the yellow envelope law, and if not, the DPK will once again pursue the revision.”The opposition bloc is also expected to oppose corporate tax incentives for conglomerates making large investments. In addition, chaebol heirs will likely face heavier inheritance and gift taxes, when they seek to inherit managerial rights from their parents.“The ruling and opposition parties basically differ on tax reduction,” said Joo Won, director at Hyundai Research Institute.Some industry officials, however, expressed cautious optimism, saying that the opposition bloc could be wary of pushing ahead with extremely radical revisions of economic and labor laws, amid difficult business conditions.“We hope that both ruling and opposition parties will work together to make laws for economic recovery and 슬롯놀이터 enhanced national competitiveness,” the Korea Enterprises Federation said in a statement.