Labor board to rule on status of principal contractors for 1st time since new labor law enactment

▲ Members of the Korean Confederation of Trade Unions take part in a rally in central Seoul, in this file photo taken March 10, 2026. (Yonhap)

labor law-dispute

Labor board to rule on status of principal contractors for 1st time since new labor law enactment

SEOUL, April 2 (Yonhap) -- A labor relations board will rule for the first time Thursday on the "employer status" of principal contractors since the enforcement of a new labor law aimed at broadening workers' bargaining rights.

The Yellow Envelope Act took effect last month, making prime contractors more accountable for subcontracted workers by expanding the definition of "employer" to a company that substantially controls working conditions even if it does not directly hire workers.

The Chungnam National Labor Relations Commission will review cases involving the Korea Institute of Nuclear Safety, the Korea Atomic Energy Research Institute, the Korea Asset Management Corp., and the Korea Research Institute of Standards and Science.

The four have not posted notices of negotiation requests from subcontractor unions despite the new law requiring principal contractors to put them up for seven days from the day they receive them.

The contractors have argued the notices were not posted as the unions did not outline the agenda items or working conditions they want to negotiate, which they say is required in order to determine whether they qualify as the employer for each item.

The unions took the cases to the labor commission, leading to the review. While the board is expected to notify the disputing sides of its decision in the evening, proceedings could be postponed.

If the board rules in favor of the unions, the prime contractors will be required to post the notices.

Disputes stemming from the new labor law are expected to continue as 267 cases on labor negotiations have been submitted to labor relations boards as of March 30, according to Rep. Cho Ji-yeon of the main opposition People Power Party.

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