Conflicting decisions on ‘separation of bargaining units’… What is the primary company’s response strategy?

It has been about a month since the revised Trade Union and Labor Relations Adjustment Act (hereinafter referred to as the Union Act), also known as the 'Yellow Envelope Act', went into effect. On the surface, the system appears to be settling down, with about 140,000 subcontracted workers requesting negotiations, but the temperature felt by the main contracting companies on site is quite different. In particular, in line with the expansion of user rights under Article 2 of the revised Trade Union Act, the results of the Labor Relations Commission's 'separation of bargaining unit' judgment on the subcontractor's union's request for direct bargaining are mixed for each case, leading to companies' management risks falling into unpredictable judicial uncertainty.

When faced with a request for collective bargaining from the subcontractor's union, the main contractor must go through the process of unifying the bargaining channel to decide 'with whom and how to negotiate', and the key issue in this process is the 'separation of bargaining units' system stipulated in Article 29-3 of the Trade Union Act. Looking at recent trends in decisions by the Labor Relations Commission, separation of bargaining units is cited as an exception in cases where significant differences in working conditions, such as wage systems or work environments, between primary and subcontracted workers are proven or when job independence is clear.

On the other hand, different legal standards are applied depending on the specific facts, such as strictly dismissing applications for separation in cases where there has been a practice in the past where the main and subcontractors have been integrated and negotiated at a single workplace, or where the characteristics of the subcontractor union are judged to be reasonable even if they are merged into the existing bargaining unit.

The fact that the Labor Relations Commission's judgment results are so mixed suggests that if companies wait and see the situation without a thorough legal review in advance, they may take on fatal risks in the future. If the separation of bargaining units is adopted contrary to the company's intention, enormous administrative costs and confusion in management will occur as the company must individually set up a negotiation table with multiple subcontracting unions. Conversely, if the separation is rejected and bundled into a single large window, the ripple effect of industrial action such as solidarity strikes by subcontractor unions will grow uncontrollably. In other words, regardless of the direction of the decision, all of the cases that companies face involve significant labor risks.

Therefore, prime contract companies should avoid a wait-and-see attitude, relying on the government's optimism shown in the indicators. A company's response strategy should not be passively influenced by the Labor Relations Commission's decision, but should focus on establishing a 'preemptive and objective logic of explanation' to set up a negotiation structure that is advantageous to the company.

To this end, the legal and human resources departments must go beyond document review and closely inspect the on-site situation to redesign the plan. First, measures to separate work spaces, movement lines, and rest facility use times can be considered as factors that can show differences in working conditions. In addition, special attention must be paid to minimizing the circumstances of direct orders from the primary office that can easily become controversial. It is advisable to avoid accidental on-site work instructions through mobile messengers or text messages, and to establish communication guidelines for primary and subcontracting and guide them to members.

Furthermore, it is a good idea to assume a hypothetical negotiation request situation with an external expert and check your company's response logic in advance. In this way, establishing practical guidelines and supplementing expected blind spots in advance is the most realistic alternative to substantially reducing the burden on companies under the current legal system. Since legal judgments may vary depending on the specific circumstances of each individual business, it is appropriate to obtain advice from a legal expert.

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