Yellow Envelope Act (Revised Labor Commission Act) Undermines Accountability, Calls for Vigilance

The Yellow Envelope Act (Revised Labor Commission Act) has emerged as a key political issue. Amid sharp divisions not only between the ruling and opposition parties but also between labor and business circles, the bill is expected to be pushed again under the banner of “protecting workers’ rights.” Although it has sparked social controversy every time, there has been no serious review of the bill’s structural problems. Its repeated reintroduction despite being scrapped multiple times is, in effect, less a legislative necessity than a product of stubborn insistence and political calculation.

The Yellow Envelope Act (Revised Labor Commission Act), which is intended to exempt or reduce liability for damages caused by strikes, in practice puts only union rights to the forefront. While emphasizing rights, it pushes the principle of responsibility to the sidelines, thereby upsetting the balance of the law. By opening the door even to the evasion of legitimate legal responsibility, it further weakens the foundation of trust in labor-management relations.

The bill allows unions to seek mitigation or exemption from damages arising from collective action and even explicitly provides a basis for courts to accept such claims. In the end, this could create a structure in which businesses must bear even losses resulting from legitimate management decisions, effectively paving the way for unions to engage in irresponsible strikes without meaningful legal constraints.

When responsibility disappears, strikes inevitably become more intense, and illegal acts and clashes are bound to increase. The damage businesses have already suffered from illegal strikes is by no means small, and this has long weighed on the vitality of the broader economy. If claims for damages are rendered ineffective, businesses will have to shoulder risk without legal protection. Ultimately, companies’ willingness to invest will shrink, and the virtuous cycle of jobs and growth will also collapse.

Another problem is the excessive expansion of the concept of “employer” and the attempt to include even non-workers as subjects of union activity. If, on top of that, the scope of industrial action is broadened, even areas that are originally the employer’s responsibility—such as management decisions and personnel authority—will become targets of strikes. If that happens, predictability in business operations will decline sharply, and conflict on the ground will intensify.

As legal uncertainty and risk grow, businesses will find it harder to justify remaining in Korea. Even now, amid the “three highs” of high interest rates, high inflation, and high exchange rates, companies are already in the thick of global competition. External conditions are also far from favorable, including the IRA, supply chain risks, and trade regulations. If legal risks continue to accumulate even at home, investment will inevitably decline and corporate departures will accelerate.

If businesses are pushed out, how are the people supposed to make a living? If the very entities that create jobs and pay taxes disappear, the damage will ultimately fall squarely on the public. Anti-business politics may help win popularity in the short term, but in the long run it destroys the foundations of the economy. Unemployment rises, tax revenue falls, and the basis for welfare is shaken.

The political establishment must stop legislation that fuels conflict. Otherwise, the burden will be borne in full by society as a whole. Trust will erode, and the costs the community must bear will grow even larger. We must remember that rights can claim legitimacy only when accompanied by responsibility.

We must be alert to laws like the Yellow Envelope Act (Revised Labor Commission Act), which undermine the principle of responsibility. Legislation that blurs the boundary between legality and illegality destroys trust in the rule of law. When the balance between rights and responsibilities collapses, the damage spreads beyond businesses to the public and society as a whole. I hope the National Assembly will immediately halt its push for the Yellow Envelope Act (Revised Labor Commission Act).

Gyumin Han, Researcher, Center for Free Enterprise (CFE)

---

Original title: 책임 원칙 허무는 노란봉투법, 경각심 가져야

Author: Gyu-min Han

Date: 2025-06-05

Source: https://www.cfe.org/bbs/bbsDetail.php?cid=press&idx=27779