IV. Prohibition Against Payment of Wages to Full-Time Union Officers and the Exception: Paid Time-Off System

1. Overview
According to the Trade Union Act, when an employer subsidizes wages to full-time union officers engaged in duties only for the labor union, this is considered to be unfair labor practice by the employer, and the employer shall be subject to a punishment of up to two years in prison or a fine of 20 million won. Since the time this provision was added to the Trade Union Act in 1997, implementation has been delayed several times, but starting July 1, 2010, it finally went into effect upon revision of the Trade Union Act on December 31, 2009. This revision, however, allows a minimal number of paid full-time union officers by introducing paid time-off for some union activities. The paid time-off can allow for full-time union officers within a maximum number of hours when the labor union and the employer agree on paid time-off. The employer shall not subsidize wages for full-time union officers in cases where there is no agreement between both parties. In May 2010 and June 2013, the Ministry of Employment and Labor announced the maximum number of paid time-off hours as decided by the Union Activity Review Commission. The following explains the revision of the Act concerning the prohibition against payment of wages to full-time union officers, and application of the revision, based on guidelines from the Ministry of Employment and Labor.

2. Prohibition Against Payment of Wages to Full-Time Union Officers

(1) Prior to revision of the law

Trade Union Act, Article 24 (Full-Time Officer of a Labor Union)
② Those who are engaged in duties only for labor unions in accordance with paragraph (1) shall not be remunerated in any way by employers for the duration of their tenure.
Article 81 (Unfair Labor Practices) 4. Payment of wages for full-time officers of a labor union or financial support for the operation of a labor union.
Addenda, Article 6 (Exceptions to Full-Time Officers of a Labor Union)
① The provisions of Articles 24 (2) and Article 81 (4) (limited to the provisions concerning payment of wages for full-time officers of a labor union) shall not apply until December 31, 2009.


(2) Implementation of the Act (Revised January 1, 2010)

The prohibition against payment of wages to full-time union officers is to be implemented on July 1, 2010. Exceptions will be made when a labor union has already stipulated a wage subsidy for its full-time union officers in the collective agreement before the Trade Union Act was revised. In such cases, the wage subsidy will be allowed for the effective period of the collective agreement, up to 2 years.

This newly revised Act introduced a ‘paid time-off system’ by tripartite agreement of union, management, and the government. This stipulates that the company can provide a minimal number of paid time-off hours for union activities, even though a wage subsidy for full-time union officers is prohibited. It is regarded as work-provision when labor union officers are engaged in collaborative activities with the company such as collective bargaining or consultation, grievance-handling, industrial safety issues, etc. and labor union maintenance/management tasks designed to promote good relations between labor and management. To determine the maximum number of paid time-off hours and the items considered as paid time-off, a Union Activity Review Commission (UARC) was composed under jurisdiction of the Ministry of Employment and Labor. The UARC consisted of 15 representatives: 5 recommended by labor, 5 by management, and 5 public committee representatives recommended by the government.

3. Paid Time-Off System as an Exception to the Wage Subsidy Prohibition

The Union Activity Review Commission (UARC) determined the maximum number of paid time-off hours at a conference attended by labor, management and public committee representatives in June 2013, which was announced by the Ministry of Employment and Labor and is implemented from July 1, 2013. Wage subsidies for full-time union officers are prohibited, but if the collective agreement stipulates such subsidy, activities for which full-time union officers receive a subsidy from the employer are allowed within the maximum number of paid time-off hours regulated by the Ministry of Employment and Labor. If there is no such stipulation in the collective agreement, full-time union officers’ activities shall not be subsidized financially in principle.

1) “Number of Union Members” refers to the total number of union members at an identical business or workplace.
2) 2,000 Time-Off Hours required to maintain one full-time union officer (considering ⓐ 2,088 hours = 40 hours per week x 52 weeks + 8 hours; ⓑ annual leave)
3) Implementation: The above shall enter into force as of July 1, 2013. In cases where the company has a collective agreement effective July 1, 2013, the above is applied from the day after the current collective agreement’s effective period expires.

4. Application of Paid Time-Off

(1)
Question) Three full-time union officers are allowed for a workplace with 500 union members according to the maximum number of paid full-time union officers determined by the Union Activity Review Commission (UARC). Can a labor union that has two full-time union officers go on strike to demand one more full-time union officer?
Answer) If a labor union goes on strike to acquire more full-time union officers than the maximum allowed according to the paid time-off table, this is illegal. Industrial action is only permitted when demands are related to the improvement of working conditions like wages, working hours and allowances. That is, going on strike is only allowed for demands related to a dispute of interests (normative items). However, if the labor union goes on strike to demand things such as more full-time union officers, payment for union activities during working hours and other contractual issues (a rights dispute), such industrial action is illegal. It is illegal for a labor union to go on strike to demand paid union hours in addition to those stipulated by the paid time-off guidelines in the Trade Union Act.

(2)
Question) When an employer refuses demands from a labor union, does the labor union have to accept the refusal?
Answer) No, it doesn’t. When the labor union goes on strike over a demand for a wage increase, demanding more paid time-off for full-time union officers as part of its industrial action may be justifiable.

(3)
Question) Paid time-off is only applicable to full-time union officers engaged in union activities. That is, union activities covered by this paid time-off are Trade Union Act-related collective bargaining, consultation, industrial safety issues, grievance-handling, and labor union maintenance/management tasks designed to promote good relations between labor and management. Considering this, will the following be regarded as paid hours: additional labor-management meetings regulated by the Industrial Safety and Health Act, the Act concerning the Promotion of Worker Participation and Cooperation (Labor-Management Council Act), and the Labor Standards Act, as well as the Trade Union Act?
Answer) Paid time-off is only applicable to full-time labor union officers engaged in union activities according to the Trade Union Act. However, activities in additional meetings regulated by the Industrial Safety and Health Act, the Labor Management Council Act and the Labor Standards Act can be regarded as paid hours.

(4)
Question) If the labor union and the company collaborate to increase the number of paid hours, is it possible to increase the number of paid full-time union officers limited by the maximum time-off?
Answer) Since full-time union officers, for which paid time-off applies under the Trade Union Act, are carrying out activities related to industrial safety, collective bargaining, consultation, and grievance-handling, a limited number of additional employees would be necessary in order to participate in Labor-Management meetings. If the company considers all or part of the work done by employees in grievance-handling as time-off, thus exceeding the stipulated maximum time-off, this is unfair labor practice by the employer, and the employer would be punished for it. The Ministry of Employment and Labor plans to carefully inspect workplaces to prevent any unfair labor practices from now on, and will visit companies to see whether Workplace Improvement Committees, Industrial Safety and Health Committee, and Labor-Management Councils (required by the Labor-Management Council Act, the Labor Standards Act, and the Industrial Safety and Health Act) are being operated properly and in ways appropriate to their purposes.

(5)
Question) The maximum number of full-time union officers is 18 for Hyundai Motors Company (HMC), which has 45,000 employees. Can the number of full-time union officers be increased when Labor-Management meetings are constituted continuously according to the Industrial Safety and Health Act, the Labor-Management Council Act, and the Labor Standards Act?
Answer) From time to time, the number of part-time union officers can increase whenever necessary. However, such numbers will not be equal to the numbers common today. It is a fact that there are many full-time union officers without specified duties who participate in these Labor-Management meetings on a regular basis.

(6)
Question) Is participation by ordinary union members in a general meeting paid or unpaid when during working hours?
Answer) This is what the labor union and the company need to decide as a policy. It is not simple to determine all such meetings as unpaid. And on the other hand, even though a company allows all time spent in general meetings as paid time-off, it is not always fair to simply punish the employer.

(7)
Question) Is a wage subsidy ordinary wages or average wages for a full-time union officer?
Answer) This would be determined by agreement between labor and management at the workplace involved. Consideration of wage subsidies as average wages would apply for companies like HMC that have previously considered wage subsidies as average wages for their full-time union officers. If the full-time union officer receives an overtime allowance and holiday work allowance, those to whom the paid time-off system applied in the past, shall have it applied as before. If the Ministry of Labor interrupts the payment criteria of private companies, this would cause more disputes between labor unions and employers.

(8)
Question) Labor union chairmen have frequently been provided a car and driver. Under the current paid time-off system, is it acceptable for the company to provide such things?
Answer) According to the paid time-off system a company would be punished for unfair labor practice if it provides a car and driver to any of its full-time union officers.

(9)
Question) Is it acceptable for the labor union and the company to simply stipulate paid time-off hours in the collective agreement, without stipulating the number of full-time union officers?
Answer) According to the Trade Union Act, paid time-off hours and the union personnel who can use them can be stipulated in the collective agreement. If so, the labor union and the company together shall determine the maximum number of paid time-off hours and the union members who can use them. As an example, if labor and management in a workplace with 350 union members (with a maximum of 5,000 paid time-off hours) agree on 4,000 hours of paid time-off, ‘4,000 hours of paid time-off: two full-time union officers’ (or one full-time union officer and two part-time union officers) shall be stipulated in the collective agreement. For a concrete list of full or part-time union officers, the labor union shall also notify the company ahead of any union activities.


[Case Study]

A parcel delivery union is demanding paid time-off and recognition of a full-time paid union officer. It is necessary to examine in detail the possibility of introducing a paid time-off system for a full-time union officer at the parcel delivery union, which consists of self-employed workers, not workers belonging to a workplace.

It is necessary to examine whether workers under the Trade Union Act are eligible for paid time-off. In the case of a full-time union officer, it is stipulated that "an employee may engage in the work of a labor union without providing the assigned work prescribed by the labor contract". Here, 'delivery contract' does not fall under 'employment contract with prescribed work' or 'working time', as the delivery person receives a service fee based on the number of units delivered. There could be questions about how a time-off system could be applied to such an individual.

1. The paid time-off system

In Article 24 of the Trade Union Act, the union's paid time-off system (also known as the paid full-time union officer system) is defined as "a worker who does not provide work prescribed by the labor contract." Paragraph 4 of the article stipulates that “in the case of a collective agreement or agreement from the employer, union officers can carry out the maintenance and management work of the union without being engaged in contractual work hours within limits not exceeding the permitted hours in accordance with Article 24-2." The union officer is usually provided with a normal salary even if the union officer does not provide the prescribed work.

2. Applicability of a paid full-time union officer in the Trade Union Act MOEL Guideline, Labor Union Dept- 196, Jan 22, 2019.


Ministry of Employment and Labor Guidelines provide answers for questions: whether the paid full-time union officer rule applies to parcel delivery unions, if the paid time-off system applies to the paid full-time union officer, and how much paid income is appropriate for the paid full-time union officer. First of all, for a paid full-time union officer, Article 24 (Paragraph 1) of the Trade Union Act states that “the work prescribed by labor contract means an amount contracted between the employer and the employee under Article 2 (Paragraph 1) of the Trade Union Act according to the terms of the agreement on wages. It should be judged in a comprehensive manner considering the contracts and agreements concluded between labor and management, and normal labor-providing practices." The workers referred to here are workers under the Trade Union Act, as well as those under the Labor Standards Act, which applies equally to the service contract as well as the labor contract.

When a parcel delivery union officer is recognized, the amount of salary for the full-time union officer would be recognized as follows: "The level of salary of union workers who are exempted from working hours can be determined by the employer based on the normal wages that the worker would receive if he or she normally worked as a general worker. This will generally be calculated based on the commission fee that could be earned for the ordinary parcel delivery man on a day-to-day basis.”