The American Chamber of Commerce in Korea (AMCHAM) voiced concern about rising labor costs ahead of a court ruling on the Kia Motors Labor Union's normal wage lawsuit.
"On Thursday (August 31), a serious judgment on normal wages which will have a great impact on Korean society and industries will be made," the AMCHAM said in a press release on August 30. "Sometimes, a policy that started with good intentions unexpectedly affects labor policies directly linked to Korea’s economic competitiveness and the competitiveness of the Korean manufacturing industry."
The AMCHAM quoted the results of two surveys; one survey by the Korea Chamber of Commerce and Industry (KCCI) that say that approximately half of foreign companies doing business in Korea answered that excessive labor regulations might force them to consider pruning investment in Korea and the other survey by the KOTRA that say that foreign companies’ satisfaction about investment and management environments in Korea went downhill from 47.5% in 2013 to 25.4% in 2014.
Based on these, the AMCHAM claimed, "A rise in labor cost will have a major impact on the sustainability of investment in Korea by foreign companies."
"We are constantly striving to find ways to secure jobs and the stability of workers and promote the prosperity of the domestic labor market," the AMCHAM said. "But the balance between an improvement in the quality of the employment of Korean workers and the sustainability of companies’ investment and business activities in Korea must be struck," the AMCHAM asserted.
"Normal wage-related policies should be a well-balanced decision made after taking into account both the prosperity of laborers and the labor market, the elimination of uncertainty in corporate management, and the maintenance of corporate competitiveness," the AMCHAM emphasized.
"The government, businesses and the labor community should closely cooperate with one another to create a business environment in Korea, which matches global standards, and to create a 'business-friendly Korea,'" the AMCHAM said.