|Issues related to the Parcel Delivery Workers Labor Union
The ‘Labor Today’ daily labor newspaper has reported on labor relations regarding the Parcel Delivery Workers Labor Union (hereinafter referred to as ‘the parcel delivery union’) composed of Post Office parcel delivery workers. There are about 3,000 parcel delivery workers at the Post Office, of which about 2,000 are unionized workers. According to an article published on January 21, 2019, the parcel delivery union requested time-off hours for union officers, a union room, a lunar holiday bonus of KRW 150,000, and full subsidy of the Industrial Accident Compensation Insurance premium. If the company does not accept these suggestions, the parcel delivery union warned that they would impose a general strike for three days starting January 26, ahead of the lunar holiday. Fortunately, according to a January 25 article, labor and management reached a provisional agreement on these issues under a mediation committee of the National Labor Relations Commission. The agreed points are (i) paid time-off is granted for the union officer; (ii) a union office will be provided, (iii) a check-off system will be applied for union dues; (iv) a holiday incentive will be introduced; and (v) the company will pay half of the IACI premium.
There are several characteristics to be considered regarding the parcel delivery union. First, a parcel delivery worker is not a worker earning wages per hour from an employer, but an individual contractor who receives a service fee according to the number of parcels delivered. Since such individual contractors are not workers under the Labor Standards Act, they are protected as workers under the Labor Union Act only. Therefore, it is necessary to distinguish the characteristics of these two different types of worker. Second, the 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. Thirdly, since the postal service of the Post Office is regarded as an essential public service, the parcel delivery service can be regarded as a minimum service to be maintained in an essential public business. It is necessary to examine whether the parcel delivery service is in fact a minimum service to be maintained for fear of jeopardizing the daily life of the people.
II. Difference between Workers in the Labor Standards Act and Workers in the Labor Union Act
Currently the parcel delivery union is composed of individual parcel delivery contractors, not employees. I would like to examine whether these individual contractors can in fact exercise three specific labor rights as workers under the Labor Union Act.
1. Workers under the Labor Standards Act
Article 2 (1) of the Labor Standards Act stipulates that the term “worker” in this Act refers to a person who offers work to a business or workplace to earn wages, regardless of the kind(s) of job he/she is engaged in. The concept of “employee” includes the following factors: 1) It is not determined by the kind(s) of job he/she is engaged in; 2) the person works at a specific business or workplace; 3) the person offers work to earn wages. In understanding this concept, wage is placed at the center, while the key point to be considered is whether a subordinate relationship exists between the one who performs the work and the one who provides the work. That is, “employee” means “a person who offers work to earn money through a subordinate relationship”. A subordinate relationship is one where a person hired by an employer provides work to that employer, under the employer’s direction and order, and carries out the tasks the employer requires to be done. This means that an employee who offers work to earn wages can be considered “a person offering work under a subordinate relationship to an employer”.
2. Workers under the Labor Union Act
Article 2 (1) of the Labor Union Act stipulates that the term “worker” in this Act refers to a person who lives on wages, salary, or other equivalent form of income earned in pursuit of any type of job. Those who receive a wage are workers under the Labor Standards Act, and those who earn income equivalent to wages are persons under the Labor Union Act. Equivalent income means any reward earned in exchange for providing labor service to another person independently, without a subordinate relationship. Therefore, ‘worker’ in the labor union law includes workers earning a wage, unemployed persons without income, and those who have no dependent relationship but continue to provide labor for income. In other words, under the Labor Standards Act, workers have both human dependency and economic dependency, but workers under the Labor Union Act are those with economic dependency only. However, this does not apply to those who provide independent work, such as a self-employed person, students who are not ready to work, or those who have given up on job searching.
3. Division of workers
If a worker is recognized as a worker under the Labor Union Act, (s)he may exercise three labor rights(rights to labor union, collective bargaining, and collective action) as a worker. Individual parcel delivery people who are registered as individual business owners and whose income depends on the quantity of deliveries can only organize labor unions and demand collective bargaining in order to improve working conditions. In this case, the employer must comply with the collective bargaining requests of labor unions, and labor unions can increase their bargaining power through strikes favoring collective bargaining. If an employer is harmed through collective bargaining or labor strikes, the employer cannot terminate the contract with the delivery agent or claim damages (Articles 3, 4, 81 of the Labor Union Act).
III. Applicability of Paid Time-off
It is necessary to examine whether workers under the Labor 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 Labor 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 by 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 the normal salary even if the union officer does not provide the prescribed work.
2. Applicability of a paid full-time union officer in the Labor Union Act
The Labor Ministry Guideline provides answers for questions: whether parcel delivery unions are applicable under the paid full-time union officer rule, if the paid full-time union officer falls under the paid time-off system, and how much is appropriate for the level of the paid income for the paid full-time union officer. First of all, for a paid full-time union officer, "Article 24 (Paragraph 1) of the Labor Union Act states that the work prescribed by labor contract means a contracted amount made between the employer and the employee under Article 2 (Paragraph 1) of the Labor Union Act under 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 Labor Union Act, including 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 level of the full-time union officer’s amount would be as 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 worker in general. 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.”.
IV. Whether Parcel Delivery Service belongs to Essential Public Service
The work of the Post Office is an essential public service. There could however, be different views on whether or not the Post Office’s parcel delivery service is also an essential public service. If it belongs to an essential public service, its labor union is restricted in its right of collective action as a union, should secure minimum services need be maintained.
1. Essential public service and minimum services to be maintained
Article 71 (2) of the Labor Union Act refers to “essential public service” as meaning each service described in the following subparagraphs, which fall within the category of public service under paragraph (1) and whose stoppage and discontinuance may endanger the daily lives of the general public, or may considerably undermine the national economy, and whose replacement presents a hardship.1. Railroad services, inter-city railroad services, and aviation services; 2. Water, electricity, gas supply, oil refinery and supply services; 3. Hospital and blood supply services; 4. Bank of Korea; 5. Telecommunication services.
Prior to 2008, in a case of essential public service, the right to strike was totally limited through arbitration by a special labor commission. As a complementary measure, the Labor Union Act introduced on January 1, 2008 abolished the arbitration system for mandatory public service and instead introduced a mandatory maintenance service system for essential public service.
The Labor Union Act stipulates that the term “minimum services to be maintained” in the Act refers to those services among essential public services prescribed in Article 71 (2), which, if suspended or discontinued, could remarkably endanger the lives, health, physical safety or daily life of the public and are prescribed by Presidential Decree (Article 42-2, paragraph 1). Furthermore, stopping, discontinuing or obstructing the proper maintenance and operation of the minimum services to be maintained shall not be carried out as a legitimate industrial action (Article 42-2, paragraph 2). If violated, prison for up to 3 years or a penalty of up to KRW 30 million could be imposed (Article 89, paragraph 1). The parties in labor relations shall conclude an agreement in writing that stipulates the levels of minimum services to be maintained and provided, the specific work designated as minimum service, the necessary number of workers, etc., in order to ensure the proper maintenance and operation of minimum services during a period of industrial action. In this case, both parties shall sign or seal an agreement on minimum services to be maintained (Article 42-3). Therefore, unions will be held liable for illegal disputes in cases where they do not engage in agreement on minimum services to be maintained.
2. Criteria for classification of essential public service
In order for a specific business to be an essential public service in the interpretation of the provisions related to the Labor Union Act, (i) the public service pursuant to Article 71 (1) of the Act shall meet the formal requirements under the provisions of Article 71 (2); (ii) the suspension or abolishment of the work shall have substantial repercussions that significantly jeopardize the daily lives of the public or that significantly impede the national economy and are not easily replaceable.
Formal requirements are in accordance with Annex 1 of the Enforcement Decree of the Labor Union Act: Each minimum service to be maintained per essential public service. Substantive requirements are: (i) to become an essential public service, the suspension or abolishment of work due to industrial action must seriously endanger the daily life of the public or hinder the national economy. (ii) since the suspension or abolishment of such service should concern a business having a large effect on the daily life of the public and the national economy, the service, the production scale of the goods, and the service supply target should be targeted to the general public; (iii) the substitution of the work should not be easy, so that it is difficult to substitute other similar companies in consideration of production and service scale. In other words, if a substitute can easily be accomplished through canceling an outsourcing contract, it should be considered that there is a possibility of substitution.
Therefore, whether the service is an essential public service or not is decided with the following condition: it should meet both of the formal and substantial requirements mentioned above.
3. Determining whether or not the parcel delivery service of the Post Office is an essential public service
The Post Office is considered part of the telecommunication business as an essential public service and corresponds to the minimum services to be maintained. According to Annex 1 of the Enforcement Decree (Minimum services to be maintained per the essential public service): "C. Universal postal services in accordance with Article 14 of the Post Service Act; D. Extra postal services in accordance with Article 15 of the Post Service Act, such as content-certified mail and special delivery service.” Here, the universal postal service is composed of "① a letter-post item, which weighs not more than two kilograms; ② a postal parcel, which weighs not more than 20 kilograms."
In Article 1-2 of the Post Service Act, the term "letter-post items" means any item of delivery intention such as a letter, currency (including a remittance notice) and small packet items. The term “postal parcel” means a package which contains items other than letter-post. At one time the majority of postal delivery service was correspondence, but recently, small parcel delivery has been increasing rapidly. Nonetheless, even if there are a large number of postal parcels in everyday mail, this is directly serving the people, and since it is impossible to substitute the postal services, the postal services must be recognized as an essential public service.
However, recently many private parcel delivery companies have engaged in delivery service, and people now have a choice of delivery companies. In particular, parcel delivery personnel in the Post Office are commissioned only for the delivery of postal parcels. Therefore, as parcel delivery service is very easily replaced by other private companies, it is hard to designate the postal parcel delivery service as an essential public service.
A parcel delivery union consisting of individual contractors with the Post Office will conclude a collective agreement for the first time in the public sector, which is very ground-breaking news. Some agreements include the recognition of paid time-off for the union officer, providing a room as a union office, holiday bonuses, and shared responsibility between the company and delivery personnel for lost parcels. In the future, I would like to see this collective bargaining of the parcel delivery union play its part as an exemplary model for improving working conditions and the social status of other contractors in other industries.