Proposed ‘Yellow Envelope Act’ Seeks to Protect Striking Workers

The proposed law would stop corporations from suing the striking union members in retaliation.

Proposed ‘Yellow Envelope Act’ Seeks to Protect Striking Workers

Photo: Korean Confederation of Trade Union members protest in favor of the Yellow Envelope Act. Credit: Office of the Assembly Member Lee Eun-ju.

On September 16, the Democratic Party 민주당 and the Justice Party 정의당 jointly proposed revisions to the Labor Union Act 노동조합법, commonly referred to as the Yellow Envelope Act 노란봉투법, which limits the ability of corporations to file suit against striking workers.

Following a strike, a usual avenue of retaliation by a corporation is to sue the union members for damages. Although Article 3 of the Labor Union Act provides that a corporation may not sue for damages caused by “strikes conducted pursuant to this act,” the courts have accepted the argument by corporations that they could claim damages arising from any strike that oversteps the narrow boundary of the legally permitted form of strikes.

Based on this, for example, Daewoo Shipbuilding and Marine Engineering (DSME) 대우조선해양 recently filed suit against the members of the Korean Metal Workers’ Union 전국금속노동조합 who held a 51-day strike by occupying DSME’s shipyard, ultimately claiming KRW 47b (USD 30m) in damages. (See previous coverage, “DSME Strike Ends.”)

The suit is filed against the union as well as individual union members who participated in the strike, threatening a massive liability over dock workers. Once the suit is filed, the corporations may provisionally attach the properties of the defendants, severely constraining the personal finances of the striking workers.

The Yellow Envelope Act would further limit a corporation’s ability to file suit against striking workers by setting caps on damages and prohibiting suits against individuals. The name of the law comes from the Yellow Envelope Campaign of 2014, when citizens sent donations in yellow envelopes to assist Ssangyong Motors 쌍용자동차 laborers who were hit with a lawsuit after their strike.

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