🚨 Yellow Envelope Law: Understanding the Controversy and Issues of Worker Damage Compensation

Today Korean Social News | 2025.04.30

📌 "Yellow Envelope Law, Exemption for Illegal Strikes Doesn't Exist Even in Advanced Countries"...Yellow Envelope Law Discussion Forum Held

💬 Concerns were raised that if the Labor Union Act Amendments (Yellow Envelope Law) passes the National Assembly, it could lead to increased labor-management conflicts and illegal actions throughout society. At a forum held by the Korea Chamber of Commerce and Industry, examples from advanced countries were used to emphasize that there are no legislative cases that completely exempt civil liability for illegal strikes, warning about the law's unconstitutionality and economic side effects. While the need to protect workers was acknowledged, opinions called for careful legislation considering the legal system and social balance.

Summary

• The Yellow Envelope Law is a bill that limits the liability for damages caused by labor union strikes.
• It was proposed to protect workers from excessive damage claims by companies.
• The debate is intense, with the balance between labor rights protection and legal responsibility being a key issue.

1️⃣ Definition

The Yellow Envelope Law refers to a bill that limits liability for damages caused by labor union strikes and prohibits claims for damages against individual union officials. Simply put, it's a bill that prevents individual workers from bearing excessive compensation responsibilities for damages that occur during labor disputes such as strikes.

The name "Yellow Envelope" originated from the "Yellow Envelope Campaign" that began in 2013 to help laid-off Ssangyong Motor workers.

💡 Why is it important?

• It affects the balance between workers' collective action rights and companies' property rights.
• It reflects social consensus on fairness in labor-management relations and protection of labor rights.
• It determines the methods of resolving workplace conflicts and the scope of legal responsibility.

2️⃣ Background and Main Contents of the Yellow Envelope Law

📕 Background of the Bill

• The burden of excessive damage compensation on workers became a key issue. The main background for proposing the Yellow Envelope Law is the issue of large damage claims made by companies after labor union strikes.

  • Some companies have claimed tens or even hundreds of billions of won in damages for labor union strikes or rallies.
  • This has led to cases where workers suffer serious difficulties such as family bankruptcy, credit delinquency, and psychological distress.
  • The large damage claims against workers in cases like Ssangyong Motor and Hanjin Heavy Industries drew social attention.

• The goal is to effectively guarantee the labor rights protected by the Constitution. The Yellow Envelope Law aims to effectively guarantee the three labor rights (right to organize, right to collective bargaining, right to collective action) protected by the Constitution.

  • Article 33 of the Constitution guarantees workers' right to collective action as a basic right.
  • However, concerns have been raised that excessive damage claims could discourage the exercise of these rights.
  • There has been growing recognition of the need for institutional support to ensure independent union activities and balance power between labor and management.

📕 Main Contents of the Bill

• It limits labor unions' liability for damages. The core of the Yellow Envelope Law is to limit the liability for damages of labor unions and their members.

  • For strikes organized by labor unions, in principle only the union bears responsibility, and damage claims cannot be made against individual members or officials.
  • However, in exceptional cases where individuals are directly involved in clearly illegal acts such as violence or destruction, they may be held personally responsible.
  • The law also places certain limits on damage amounts to protect the survival rights of unions and workers.

• It guarantees workers' minimum livelihood. The bill also includes measures to guarantee workers' minimum livelihood.

  • To prevent situations where workers' basic living becomes impossible due to damage compensation or provisional seizure, certain portions of wages or retirement benefits would be protected.
  • To prevent household bankruptcy, the bill expands the scope of assets exempt from provisional seizure and also places limits on the period during which damage claims can be made.
  • This is an attempt to find a balance that acknowledges responsibility for labor disputes while ensuring that workers' right to survival is not threatened.

Main Contents of the Yellow Envelope Law

1. Limitation of Compensation Subject: In principle, only the union is responsible for strikes organized by labor unions
2. Individual Immunity Provision: Limitation on damage claims against individual union officials and members
3. Violence Exception: Individuals directly involved in violent/destructive acts may be personally responsible
4. Setting Upper Limits on Compensation: Protection of labor unions and workers from excessive damage compensation
5. Livelihood Protection Measures: Restricting provisional seizure of basic living funds such as wages and retirement benefits

3️⃣ Core Issues in the Yellow Envelope Law Debate

✅ Arguments in Favor

• Workers' right to collective action needs to be guaranteed. Supporters of the Yellow Envelope Law present the guarantee of workers' constitutional rights as an important basis.

  • They argue that excessive damage claims can effectively neutralize workers' right to collective action.
  • Since collective actions like strikes are the last resort for workers to gain equal negotiating power with employers, excessive restrictions can deepen the imbalance in labor-management relations.
  • They emphasize that the International Labour Organization (ILO) has also raised concerns about imposing excessive civil liability for strikes.

• Protection of workers' right to survival is urgent. Supporters argue that protecting workers' right to survival is an urgent issue.

  • They point to cases of workers being driven to extreme situations like family breakdown and suicide due to enormous damage claims.
  • They argue that damage claims are sometimes misused as a means to suppress labor union activities.
  • They believe it's unfair to place the burden unilaterally on workers since damages that occur during labor disputes are the responsibility of both labor and management.

✅ Arguments Against

• Responsibility for illegal acts should be maintained. Opponents argue that responsibility for illegal acts should be maintained according to the rule of law.

  • They point out that exempting liability for damages caused by illegal strikes violates legal principles and has no precedent in advanced countries.
  • They argue that legitimate strikes are already exempt from civil liability under current law, so expanding the scope of immunity is unnecessary.
  • They claim that relaxing responsibility for illegal acts could damage the legal order and lead to the spread of illegal acts in other areas.

• It could infringe on companies' property rights and management rights. Opponents worry about infringement on companies' legitimate rights.

  • They believe that requiring companies to fully bear the damages from illegal strikes infringes on companies' property rights.
  • They argue that limiting union responsibility could seriously impact business management, potentially threatening the survival of small and medium-sized enterprises in particular.
  • While acknowledging the importance of guaranteeing labor rights, they emphasize that the rights of both companies and workers should be protected in a balanced way.

4️⃣ Domestic and International Cases and Current Status

🔍 Major Domestic Damage Compensation Cases

• The Ssangyong Motor case became the catalyst for discussions on the Yellow Envelope Law. The case of Ssangyong Motor workers became an important catalyst for discussions on the Yellow Envelope Law.

  • After the 2009 Ssangyong Motor strike, the company and police claimed about 17 billion won in damages from the labor union and its members.
  • As a result, laid-off workers experienced economic difficulties and psychological distress, with some making extreme choices.
  • The "Yellow Envelope Campaign" that began in 2013 was a voluntary fundraising movement by citizens to help these workers, and became the origin of the bill's name.

• Other cases like Hanjin Heavy Industries also gained attention. Similar cases occurred at several companies besides Ssangyong Motor.

  • Hanjin Heavy Industries claimed about 15.8 billion won in damages from workers who participated in strikes against layoffs in 2011.
  • Large damage claims followed strikes at various workplaces including Hyundai Motor Company and the Railway Workers' Union.
  • These cases raised concerns that damage claims could be used as a means to suppress labor union activities.

🔍 Status of Related Legal Systems Abroad

• Germany limits liability for strikes. Germany has a balanced approach to labor disputes.

  • Germany broadly recognizes the scope of legitimate strikes through case law, and in these cases does not impose civil liability.
  • However, for clearly illegal strikes, the union and those responsible can be held liable for damages.
  • Individual union members are generally exempt from liability unless they directly participated in illegal acts.

• The UK and Japan also have various restriction provisions. Various countries limit the scope of responsibility for labor disputes.

  • The UK has immunity provisions for legal strikes through the "Trade Disputes Act," and also limits the scope of responsibility for illegal acts.
  • Japan has civil immunity provisions in its "Labor Union Act," but responsibility can be imposed for violence or destructive acts.
  • However, no country completely exempts responsibility for illegal strikes, which has become an important issue in the Yellow Envelope Law debate.

5️⃣ Related Terminology

🔎 Strike Action

• Strike action refers to collective struggle activities by workers.
• Strike action refers to activities such as strikes, slowdowns, and picketing that workers collectively undertake to achieve their demands regarding wages, working conditions, etc.
• According to Article 2 of the Labor Union Act, strike action is defined as "strikes, slowdowns, lockouts, and other actions taken by labor relations parties to achieve their claims and actions to counter them."
• Based on the right to collective action guaranteed by Article 33 of the Constitution, legitimate strike actions are exempt from civil and criminal liability. However, "legitimacy" is judged by comprehensively considering various factors such as purpose, subject, procedure, and method, and this aspect often becomes a source of conflict between labor and management.

🔎 Damage Compensation

• Damage compensation is when a person who has caused harm to another compensates for that harm.
• Damage compensation refers to a system where a person who has caused harm to another through illegal acts or breach of contract compensates for that harm financially.
• According to Article 750 of the Civil Act, "A person who causes harm to another by an unlawful act, intentionally or negligently, is liable to compensate for that harm."
• In labor disputes, companies sometimes claim damages from labor unions or workers due to production disruptions, business losses, etc. caused by strikes. In these cases, the legitimacy of the strike action becomes an important criterion for determining liability for damages.

🔎 Provisional Seizure

• Provisional seizure is a measure that can result from damage compensation lawsuits, where creditors temporarily secure the debtor's property.
• Provisional seizure is a system where creditors temporarily secure the debtor's property to execute monetary claims, preventing situations where the debtor disposes of property making it impossible to execute judgments later.
• It is stipulated in Article 276 and beyond of the Civil Execution Act, and according to court decisions, the debtor's real estate, deposits, salary, etc. are restricted from being disposed of.
• In relation to labor disputes, companies often apply for provisional seizure of the property of labor unions or workers while filing damage lawsuits. This can cause economic difficulties for workers who may not be able to receive their wages or retirement benefits, or dispose of their personal property.

6️⃣ Frequently Asked Questions (FAQ)

Q: Aren't legitimate strikes already exempt under current law?

A: Yes, according to Article 3 of the current Labor Union Act, "there is no civil liability for damages caused by legitimate strike actions." However, the interpretation of the scope of 'legitimate' strike actions is a contentious issue. Courts generally judge the legitimacy of strike actions by comprehensively considering various factors such as purpose, subject, procedure, and method. Labor groups criticize these criteria as being too strict, as entire strikes are often judged illegal due to minor procedural flaws or some extreme actions. The Yellow Envelope Law aims to relax these legitimacy judgment criteria and limit the scope of liability for damages even if judged illegal. On the other hand, management groups argue that labor rights are sufficiently guaranteed under current law, and exempting responsibility for illegal acts violates the rule of law.

Q: What changes would occur if the Yellow Envelope Law is passed?

A: Three major changes are expected if the Yellow Envelope Law is passed. First, liability for damages caused by labor union strikes would be limited to the labor union itself, and in principle, damage claims could not be made against individual union officials or general members (except in cases where they directly participated in violence or destructive acts). Second, upper limits would be set on damage amounts, allowing labor unions and workers to avoid unbearably large compensation responsibilities. Third, provisional seizure of basic livelihood means such as wages or retirement benefits would be restricted, guaranteeing workers' minimum living rights. Labor groups expect these changes to effectively guarantee the three labor rights and restore balance in labor-management relations, while management groups express concerns that companies' ability to receive compensation for damages may decrease and illegal strikes may increase. Socially, the impact on labor-management relations and industrial sites may vary depending on the specific content of the bill, so in-depth discussion of detailed provisions is necessary.