Ⅰ. Concept

The purpose of this Act is to maintain order in industry, and contribute to development of the national economy by promoting the common interests of labor and management through joint participation and cooperation. This Act concerning the Promotion of Worker Participation and Cooperation(hereby, called the Worker Participation Act) provides for a consulting organization, known as the labor-management council(hereinafter also referred to as the Council).
All businesses that ordinarily hire more than 30 persons shall establish a Council. The number of employees hired ordinarily shall meet the standards of Article 14 of the Labor Standards Act, with the exception of the business owner, business representative, and all who are working in favor of the employer.
The unit for its establishment shall be a unit of business or a workplace that is given the authority to outline working conditions. For two different working places for one company, a separate workplace can be established for each. The Council of the Worker Participation Act shall not affect collective bargaining of the labor union, or other union activities.

1. Employers who have 30 employees or more shall establish a labor-management council in the main office and are permitted to establish a labor-management council in the workplace.

According to the Labor-Management Council Act(hereinafter the LMC Act), a labor-management council shall be established in a unit of the business or workplace where there are at least 30 normal employees, so that the employer shall promote employee welfare and healthy development of a business and workplace. The number of employees related to the establishment of the labor-management council shall be estimated on the basis of each business or workplace. In cases where there are fewer than 30 employees in one workplace, the employer does not have to establish a labor-management council. In accordance with Article 4(2) of the LMC Act and Article 2(2) of the Enforcement Decree, where the total number of workers engaged in one business is 30 or more, even if the workers in one business are dispersed in different regions, a labor-management council shall be established at the principal office, and each workplace can also establish a labor-management council.

2. Non-profit businesses or workplaces are not exempt from the duty to establish a labor-management council.

A labor-management council shall be established in each business or workplace ordinarily employing 30 employees or more, which is vested with the right to decide working conditions. A non-profit business or workplace is not exempt from the duty to establish a labor-management council.

3. In cases where one business consists of several workplaces in different regions, the employer shall establish an overall labor-management council combining several workplaces.

In cases where one business consists of several workplaces in different regions, the employer shall establish an overall labor-management council combining several workplaces(including the headquarters). Accordingly, in cases where workplaces are in Seoul, Jinju, and Daegu, the employer shall establish and operate an overall labor-management council combining the three workplaces. The representative director shall attend the combined labor-management council meetings and the employee members shall be composed of members representing each of the three workplaces. On the other hand, the employer does not have to establish and operate a labor-management council in each workplace, but, if possible, it is recommended. In this case, the labor-management council in each workplace can be held with the attendance of the top-level managers(plant manager, etc.) and employee members from that workplace.

4. In cases where the company has been divided into two entities, a labor-management council shall be established and operated for each.

According to the LMC Act, the labor-management council is different from a labor union. A labor union is organized for the purpose of maintaining and improving working conditions and enhancing economic and social status. However, the labor-management council is a consulting organization for the promotion of employee welfare and healthy development of the workplace, and shall be established in each business or workplace ordinarily employing at least 30 employees, which is vested with the right to decide working conditions.

Ⅱ. Composition of the Council

The Council shall be made up of an equal number of members representing the employer and the employees, the number of which shall be at least three but fewer than ten.
While members representing employees shall be elected by the employees, labor union representatives or those recommended by a labor union shall be the employee representative in cases where the labor union is formed by a majority of employees. Employee members of a business or workplace where such a labor union consisting of a majority of employees fails to organize shall be elected by direct and secret vote. If this is deemed impossible due to certain characteristics of the business or workplace, employees may elect their representatives in proportion to the number of employees in different departments. Then, the representative shall be elected by direct and secret vote with majority participation of the voters. However, members representing employers shall be representatives of the business or workplace concerned or the persons designated by such representatives.
The tenure of membership shall be three years until renewal. A representative shall continue to perform his duties until a successor is elected even if the term of office has expired. Members shall not work exclusively for the Council, but shall be compensated for their services to the Council, which exists to maintain the neutrality of members’ status and to make certain of work efficiency and impartiality. However, the time spent by the members to attend meetings of the Council shall be regarded as hours devoted to work. The employer shall not take disadvantageous action against the members’ interests in relation to the performance of their duties as members of the Council.

1. The members of the labor-management council representing employees in a unit of a plant where there is no labor union or employee representative shall be elected in a direct and secret vote by the employees.

Article 6 of the LMC Act stipulates that, while members representing employees shall be elected by employees, labor union representatives or those recommended by a labor union shall be the employee members in cases where the labor union is formed by a majority of employees. The employee members shall be employees in the corresponding business or workplace and the majority of employees shall be estimated in a unit of the corresponding business or workplace. Accordingly, in establishing a labor-management council in a unit of the workplace, the employee members shall be recommended by the labor union in cases where the labor union is formed by a majority of employees. If the union is formed by less than a majority of employees, the employee members shall be elected by direct and secret vote by the employees.

2. Employer behavior that may affect the election of employee members directly or indirectly shall be prohibited.

1) According to Article 6(2) of the LMC Act and Article 3 of its Enforcement Decree, the employee members shall be elected by a free choice of all employees in cases where there is no labor union representing a majority of employees. This means that employees shall voluntarily compose an election administration commission that can implement the registration of candidates and manage the election.
In this regard, Article 10(1) of the LMC Act stipulates that, No employer shall intervene in or interfere with an election of the employee members. This means that the employer shall not take any action directly or indirectly to influence the result of the election.
The employer shall not only be prohibited from actions designed to influence winning or losing of election for a particular candidate, but shall also not influence decision-making about general matters related to the election of an employee commission, like the establishment or activities of an election administration commission. Article 11 of the LMC Act stipulates an order of correction for these violations.

2) The employer of the LMC Act is the identical employer stipulated in Article 15 of the Labor Standards Act in accordance with Article 3(3) of the LMC Act: The employer means a business owner, or a person responsible for management of a business or a person who acts on behalf of a business owner with respect to matters relating to workers. The term, a person who acts on behalf of a business owner with respect to matters relating to workers means a person given by the employer a certain range of responsibilities and authority for the determination of working conditions like personnel, wages, welfare, and labor management, and command and supervision for implementation of labor service. This shall not be estimated by a formal job title, such as Section Manager or Senior Manager, but shall be estimated in an individual and concrete manner on the basis of job characteristics and actual work performance.

3. Although the representative of a labor union was dismissed and filed a dismissal case, he cannot maintain his status as employee member because he is not an employee under the Labor Standards Act due to his dismissal.

The term Employee in Article 2 of the LMC Act is defined in accordance with the Labor Standards Act. A representative in a labor union that was formed by a majority of employees can become an employee member under Article 6 of the Act and he/she must become an employee under the Labor Standards Act. Accordingly, although a representative of a labor union was dismissed and filed a dismissal case, he/she cannot maintain his status as employee member because he/she is not an employee under the Labor Standards Act due to his/her dismissal.

4. A union officer of an upper level labor union cannot become an employee member of the labor-management council.

The labor-management council is a conversational organization between labor and management, involving only employees and employers in the corresponding workplace. This does not only apply to a compulsory labor-management council under Article 4(1) of the LMC Act, but also to an arbitrary labor-management council under Article 4(2) of the LMC Act. Accordingly, the employee members in the labor-management council established per workplace shall consist of only employees engaged in that workplace, so a union officer of an upper level labor union cannot become a member.

Ⅲ. Operation of the Council

1. Council bylaws

A Council shall establish bylaws governing its organization and operations and shall submit a report on them to the Minister of Employment and Labor within fifteen days from the date of establishment. Any amendment thereto shall also be submitted to the Minister of Employment and Labor within fifteen days(Article 18 of the LMC Act).

Where the bylaws of the Council are made or modified, they shall be passed by decision of the Council. The bylaws of the Council shall contain such matters as listed in the following:
① Number of members;
② Matters relating to the procedures for election of employee members and registration of candidates;
③ Matters relating to the qualification of employer members;
④ Matters concerning hours regarded as hours worked by Council members;
⑤ Matters concerning the calling of meetings, sessions and operation, etc. of the Council;
⑥ Matters relating to the method of and procedures for voluntary arbitration; and
⑦ Matters relating to the number of grievance-handling members and to the handling of grievances, etc.

2. Meetings

In general, the Council shall hold meetings once every three months, but it can hold additional meetings if deemed necessary. The chairman shall call for and preside over the meetings of the Council. If the representative of either labor or management requests a meeting to be held, specifying the purpose of the meeting in writing, the chairman shall call for a meeting of the Council. The chairman shall notify each member of the date, time, place, agenda, etc. of the meeting seven days prior to the meeting.
Meetings shall open in the presence of a majority of employee members and employer members respectively, and a resolution shall be passed by a vote of more than two-thirds of all members present. Council meetings shall be open to the public; however, they may be closed to the public upon resolution of the Council.
The minutes shall include the signatures and seals of all attending members and shall be preserved for three years from the date drawn.