“I was just a part-time employee — now I will be receiving 50 million Korean won per year.” Recently, such a Kakaotalk message ostensibly written by a security screening worker at Incheon International Airport circled the Internet. Although details of the message turned out to be incorrect, its sentiment hinting that the writer will soon become a regular employee, not by his or her own merits, enraged many South Koreans. This message sparked fierce controversy surrounding the transition of non-regular employees to regular employees at Incheon Airport. The spark then grew into a flame, bringing to light South Korea’s deep-rooted discord between regular and non-regular employees.

On June 22, the Incheon International Airport Corporation declared its plan to convert 1,902 non-regular security screening workers into private police, a directly employed position. Moreover, according to Hankyoreh, all non-regular employees in safety-related jobs have been converted into direct employment by the Incheon Airport, while the rest are slated to become regular employees of the airport’s subsidiary companies.

At first glance, Incheon Airport’s move seems to do no wrong; it can be viewed as an effort to better the situations of underappreciated non-regular employees. However, because of its complex implications for the labor market, many are fiercely gauging the validity and impact of Incheon Airport’s decision. Those who are preparing to be or already employed by public enterprises, including Incheon Airport, disagree with the decision based on the principle of fairness. Some non-regular employees at the Incheon Airport are protesting against the decision, maintaining that there is unreasonable discrimination even among themselves. Academics and labor activists also each have their take on the situation regarding what measures should be taken henceforth.

Everyone’s stance seems to be different because Incheon Airport’s decision is so critically linked to the current government’s labor policies. But it is also connected to the entire South Korean labor market, which is dualized into regular and non-regular employees. This structure of the labor market is a chronic illness of the South Korean labor sphere that has existed since the financial crisis of the 1990s. The issue remains despite several governments’ attempts to resolve it.

What It Means to be a Non-Regular Employee

Non-regular employment and regular employment are not precisely defined in the law. The closest description for regular employees in South Korean law is “workers with an employment contract which does not determine the term of the employment.” For example, this phrase appears in the fourth article of the Act on the Protection, etc. of Fixed-term and Part-time Employees. The article states that if an employer retains a fixed-term worker status for more than two years, the worker is regarded as one of the “employees who signed a contract which does not limit the work period.” There is no official definition of regular employment besides such semantically similar phrases.

According to Statistics Korea, non-regular workers are defined by the form of their employment. This indicates that the main job of the non-regular workers will terminate either after a period fixed in advance or after a period that is not known in advance but is defined by objective criteria — such as the completion of an assignment or the period of absence of the temporarily replaced employee. In 2019, non-regular employees in Korea accounted for 36.4 percent of all workers, according to Statistics Korea. The average for Organization for Economic Cooperation and Development (OECD) nations was 11.4 percent, which is why the Korean government is endeavoring to implement various policies to decrease the level of non-regular employment.

The Gap Between Regular Workers and the Rest

Currently, the Labor Standards Act does not have a clause that demonstrates the principle of equal pay for equal labor, which contributes to the problem of unfairness between the two forms of employment. The disparity in wages is thus significant. According to research conducted by the Ministry of Employment and Labor (MOEL), the average wage of regular workers was found to be 22,193 Korean won per hour. Non-regular workers earn an average of 15,472 won per hour or only 69.7 percent of the wage of regular workers. Such a wage difference contributes to labor market dualism — inequality between the non-regular workers and regular workers, along with further disparity in various other factors.

In terms of fringe benefits, non-regular workers are again confronted by inequality. From trivial issues such as holiday gift sets, to more serious matters such as access to the intranet of the company, the differences are highlighted within various aspects of the work environment. Furthermore, only 38 percent of non-regular workers benefit from the national pension, whereas nearly 90 percent of all workers employed in regular positions attain a national pension account, according to Statistics Korea. The unfair treatment is criticized as an invasion of human rights, as it invades the right to be happy and aggravates workers’ general welfare.

Non-regular contracts are sometimes seen as a stepping-stone into stable employment, especially for those that are relatively young. However, the OECD disclosed that only 11.1 percent of those engaged in non-regular labor have attained regular positions. The low transition rate also implies that the inequalities tend to continue in the long run. In its 2014 report, the OECD stated that without the motivation to transfer towards a regular occupation, non-regular workers tend to yield output with low quality. That is, the position and the differences in treatment become a hierarchical attribute that cannot easily be changed with time.

The differences in terms of wage, labor welfare, and low transition rate have induced an eager desire for South Koreans to become regular workers. Major developed countries such as the United Kingdom (UK) and Germany have relatively high rates of temporal labor, but the percentage of non-voluntary part-time labor, which consists of workers who want full-time work, is relatively low. However, according to the Statistics Research Institute, the non-voluntary part-time job rate was 49.8 percent in 2017 in Korea. This comparatively high desire to escape from part-time positions has created an excessive social demand for regular positions. As complaints from non-regular workers and job seekers have intensified, the Korean government has increasingly faced a burden to enforce policies regarding non-regular workers.

The spread of the novel coronavirus disease (COVID-19) in 2020 has made the situation even worse. Owing to the economic crisis triggered by the pandemic, a number of non-regular workers have been experiencing unemployment. According to the survey implemented by a civic organization Gabjil 119, 26.3 percent of non-regular workers have experienced unemployment after the spread of COVID-19. Their employment instability is worsening along with the necessity to ensure worker security.

South Korea’s Current Direction

For a long time, matters regarding non-regular workers have been a core issue for governments, and President Moon Jae-in’s administration has not been an exception. Just three days after his inauguration in May 2017, President Moon chose Incheon Airport as the location for his first-ever visit as president. At the airport, he announced that he would “begin an era of zero non-regular employment in the public sector” during his term of office. Such a statement represented the emphasis President Moon placed on resolving the issues surrounding non-regular employees from the beginning of his term.

President Moon’s focus on the mistreatment of non-regular workers was manifested through policies regarding the increase in minimum wage and the transition of non-regular employees to regular employees. Indeed, the transition from non-regular to regular employment has occurred in waves since MOEL announced the Guideline for Transition of Non-Regular Employees to Regular Employees on July 20, 2017. The guideline made two goals clear: first, those with a job that requires one to work for more than nine months a year were to be regularly employed, and second, transitions were to occur through labor-management negotiations at individual institutions.

Influenced by the government, a notable number of public enterprises made the required transitions under these two broad principles. According to MOEL and Seoul Shinmun, there were 311,888 non-regular employees in the public sector as of May, 2017; out of these, only 32,000 employees had transitioned by 2017. However, within just two years, the accumulated number of transitioned employees grew in the thousands. As of 2019, 174,000 of the total non-regular workers became regularly employed. The government aims to reach a total of 205,000 transitioned workers in the public sector by the end of 2020. Therefore, the aforementioned and recently highlighted decision of the Incheon Airport was not a decision out of the blue. In fact, albeit small, it was representative of a grander labor policy already in motion.

Varying Voices Make Their Cases

Nevertheless, many South Koreans have voiced their disagreement with Incheon Airport’s decision and the government labor policies that encompass it. As of July 23, a Cheong Wa Dae presidential e-petition titled “Stop the Transition of Non-Regular to Regular Employees in the Public Sector” reached 352,266 signatures. The petition primarily pointed out the injustice in the airport’s decision, asking “what this means to current employees and employee-hopefuls studying and attaining work experience to acquire this job.” Additionally, the writer cited the instance of Korea Railroad’s employee recruitment quota being decreased after the transition of non-regular to regular workers. As such, concerns that Incheon Airport and other public enterprises will suffer the same side effects were disclosed.

Interestingly, some non-regular employees seem to be against the airport’s decision as well. Yonhap News reported that on July 8, the Incheon Airport Screening Service Labor Union held a press conference in front of Chung Wa Dae in protest of the transition. According to their statement, the transition will force about 40 percent of the currently employed screeners to go through an open competitive recruitment process in order to secure the job they already have and should be able to retain. All in all, it seems that various interested parties are not in favor of the airport’s decision to transition.

Some experts in the field, however, suggest different analyses of the public’s reaction to Incheon Airport’s decision, attributing their severe reaction to factors outside of the current government’s labor policies. Professor Lee Byoung-Hoon (Department of Sociology, Chung-Ang University) viewed young South Koreans’ rage towards the airport’s decision as partly circumstantial: “Incheon Airport is representative of public enterprises, which are highly preferred workplaces in South Korea. Therefore, it is understandable that job applicants would respond negatively to what seems to them to be undeserving transitions, especially now that the already depressed labor market is hit by the impacts of COVID-19.”

The government and Incheon Airport’s slightly excessive promotion of the transition plans may also be cited as reasons for the negativity. Kim Ki Woo, a senior research fellow at the Federation of Korean Trade Unions (FKTU) Research Center, commented, “The truth is that only about 22 percent of the airport’s non-regular employees have been transitioned to regular workers. However, Incheon Airport kept their detailed plans for the transition under wraps while the media amplified it, based on the government’s motto ‘zero non-regular employment.’ Therefore, the public naturally understood their decision as totally converting all non-regular employees to fully regular employees, causing the dismay.” It seems the airport had not taken sufficient measures to align the government’s hopes — and along with it the media outlets’ reports — with their reality.

To Hold On, or to Let Go?

The mixed and quickly changing viewpoints on Incheon Airport’s decision and the government’s policy for employment transitions leaves individuals wondering just how impactful the policy in question is. A labor policy focusing on transitioning non-regular workers to regular workers was not introduced by the current government. Since the beginning of the Roh Moo-hyun administration in 2003, similar policies have been attempted by subsequent governments, but none have come to fruition.

From such a point of view, the government’s policies seem to have advanced. Understanding that the labor market and corporate needs and wants often obstructed the transitions, the government chose to exert their control where they could: to transition non-regular employees within public enterprises.

At the same time, the government acknowledged the public’s potential resistance. Labor policies detailed that the specifics of transitions could vary and must be negotiated individually at each public enterprise. Moreover, the transitions of non-regular employees were not as dramatic as they seem. The former non-regular employees of public enterprises are now either regular employees of the enterprise’s subsidiary company or semi-regular workers directly employed by the enterprise itself. According to Kim, neither of these receive the same level of welfare benefits or wages that the average regular employee would receive, although both are an improvement from non-regular employment. Overall, the government seems to have made sufficient compromises in order to achieve the goal of employment transitions.

However, each compromise may be a double-edged sword. The position of a semi-regular worker is a step up from non-regular employment as its contract is based on an indefinite period of employment. This difference guarantees labor stability; nonetheless, semi-regular employees do not receive any other benefits a regular employee enjoys. For instance, a regular employee benefits from wage increase according to seniority; a semi-regular employee does not.

The fact that the government heavily influences the public sector allowed many successful transitions. However, this also implies that the government cannot exert the same amount of force in the private sector, where various parties come into play. Thus, the current hope for public enterprises leading in employment transitions may be for the private sector to follow in their footsteps.

South Korea’s Potential Road Map

Despite the fact that the expansion of employment transitions into the private sector was the declared outcome of the public sector transitions, the possibility of it realistically unfolding may be very low. Park Yong Cheol, Vice Chief at the Korea Labor and Society Institute, stated, “While the public sector’s ratio of non-regular employees dramatically decreased in the last three years, non-regular employment in the private sector actually grew. Without further fundamental changes in regulations regarding outsourcing, closing the gap between non-regular and regular employees seems unlikely in the private sector.” In other words, the changes may not be as impactful as the government hopes, as the public sector is only a small portion of South Korea’s labor market.

Despite the policy’s issues, it seems employment transitions in the public sector will continue for now. If successful, the government’s actions, especially with Incheon Airport, may indirectly impact the private sector. Kim stated, “If successful, the government’s policy in employment transition and Incheon Airport’s case may have a demonstration effect on private enterprises. As they have a representative example to follow, companies may model their future employment policies on it.”

Nevertheless, several improvements to the policy have been suggested; one of them has to do with labor market flexibility, which is a labor market’s capacity to “effectively reallocate human resources in response to external factors such as recessions,” according to the Hankyung Dictionary for Economic Terms. Labor market flexibility is an integral quality of a capitalistic economy in that it allows companies to quickly adjust supply to the market’s demand. The levels of three kinds of flexibility regulate the total labor market flexibility: numerical flexibility, functional flexibility, and wage flexibility. Numerical flexibility is controlled by the strictness of the criteria for hiring and firing and the number of temporary workers. Therefore, the current government’s choice to transition employees has criticized on the ground that it stiffens numerical flexibility, thereby decreasing labor market flexibility.

However, Professor Lee commented that the government’s attempts to reduce temporary workers and thereby increase workers’ stability could coexist with labor market flexibility — by increasing wage and functional flexibility. “Since South Korea’s former policies focused on increasing numerical flexibility have created a dualized labor market, following the European model and emphasizing functional and wage flexibility instead of numerical flexibility may be a potential solution. A total wage reform in both the public and private sectors, as well as changes in work organization and allocation will help maintain the overall labor market flexibility.”

The term flexicurity, for which European countries such as Denmark and the Netherlands are representative examples, may be another potential road map for Korea’s labor policies. A portmanteau of the words flexibility and security, flexicurity is a concept which aims to fulfill both labor market flexibility and the welfare of workers by creating a social security net for workers. It suggests that corporations should be given liberty to retrench employees, and that dismissed workers be provided with government aid as well as reemployment training.

“Changes will have to be made to model examples of flexicurity policies before applying them. Nonetheless, South Korea’s economy and labor market will benefit from adopting flexicurity,” Kim stated. By doing so, the Korean government will be able to seek an equilibrium between two different values: the efficiency of the market and the safety of workers.

Changes on the Horizon

Wage reform and regulation of extreme outsourcing are some of the various resolutions proposed to relax South Korea’s dualized labor market. However, most of them may be difficult to enforce because they would involve changes to which private sector companies would emphatically object. Therefore, the plausible resolution would be for the government to intervene and pursue flexicurity through its policies.

Currently, the government seems to be on track to flexicurity by having non-regular employees also benefit from employment insurance. Employment insurance provides financial support for a certain period after dismissal, as well as training programs, and introduces novel jobs to the unemployed. Since unemployment will not destroy non-regular employees’ livelihood, and the fact that there is a high possibility of reemployment, security can be ensured along with flexibility when the scope for employment insurance is widened.

“Most of the academic sphere share the same belief that social security must be ensured,” highlighted Kim Ki Woo. Kim further explained that the necessity of employment insurance, specifically providing training to facilitate reemployment, is gaining social empathy. Current propositions at the National Assembly about the basic income guarantee are in the same vein; it focuses on ensuring a certain quality of life regardless of employment status.

In line with academia’s consensus, the government has been attempting to enhance social security. On July 8, the Special Committee on Income-led Growth, an affiliated agency of the Presidential Commission on Policy Planning, held a forum on how to ensure the employment safety net. The forum suggested an income-based employment insurance system. In contrast to the existing system which decides the insurance fee based on monthly salary, the new system would determine the fee based on income, enabling the insurance to be applied to laborers without a fixed-wage.

“Rather than the current system in which employers and employees pay half the insurance premiums in terms of employment relationships, we should consider deducting the premiums in the places where income is generated. Moreover, the government could replace insurance premiums for low-income vulnerable groups by introducing a system that reduces social insurance premiums for those with less than 50 percent of the median income,” stated Professor Lee Jong Sun (Graduate School of Labor Studies). As more and more forms of non-regular workers continue to emerge, especially in this age of post-COVID, the need to ensure the security of workers with employment insurance seems to be becoming clearer.

Indeed, Incheon Airport’s decision to convert non-regular workers to regular workers once again exposed the profound issues regarding the dualization of the South Korean labor market. The controversy also brought forth all potential resolutions to the polarized and dualized South Korean labor market. The application of the policy in private sectors, expansion of the social security net, reform of wage guidelines to be based on equal pay for equal labor, and more are bubbling up in the current discourse about potential labor policy changes.

Therefore, it may only be plausible to use the attention gained by this controversy as momentum for scrutinizing and improving South Korea’s current labor policies related to non-regular employment. It is now the government’s turn to readily accept feedback and alter its policies accordingly. Only then, will a society in which all laborers work safely and freely be seen on the horizon.