"American head offices regard South Korea as a republic of militant trade unions. If the situation doesn't improve, foreign firms will want to leave Korea, not invest here."

"The management and the government, too, are responsible for the current serious labor disputes. Why can't they explain the situation to workers frankly?"

Foreign firm CEOs based in Korea are uneasy these days; in the past they had rarely been concerned about the safety of their families during labor disputes. A number of foreign companies operating in Korea have recently resorted to lockouts in the face of militant unions.

On Thursday, the Chosun Ilbo sponsored a round-table meeting on labor disputes with several foreign firm CEOs. Attending the discussion, which was held at the Chosun Hotel and moderated by Kim Yung-soo, the daily's deputy industry desk, were William Oberlin, the president of the American Chamber of Commerce in Korea; Jeffrey Jones, an attorney at Kim & Chang Law Office and the former AmCham Korea president; James Blajik, the president of Owens Corning Korea, and Lee Sam-hwi, the president of Nestle Korea Ltd., the Korean affiliate of the Swiss food company Nestle S.A.

Oberlin sits on the National Economy Advisory Council, and Jones is a private commissioner of the Regulations Reform Commission. Owens Corning Korea locked out its factory last month, and has only recently reached a compromise with its union. Nestle Korea also shut down its Seoul office.

Lee Sam-hwi, President, Nestle Korea: Korea's labor problem is linked with the country's cultural traditions. Koreans have strong convictions and work hard. They are strongly attached to themselves, their families and the groups they belong to. On the other hand, they rarely consider others. Often heard in labor-management negotiations are such radical expressions as "We'll die here" and "We'll negotiate till our death." These expressions can hardly be found in union-management talks in other countries. In its recent negotiation with its union, Hyundai Motor agreed to a major pay increase, without considering its effects on suppliers. The union leadership also has problems. Once a labor dispute is settled, the no-work, no-pay principle is usually applied to unionists, but full-time union officials are excepted. They get paid for the period of the strike. Union leaders' selfishness is a hurdle to developing a mature labor-management relationship.

Blajik, President, Owens Corning Korea: The Korean model that has developed by exporting manufactured goods now faces a major crisis. If it fails to transform itself now, it could face a disaster. As was the case during the 1997 financial crisis, an unseen cancer is growing. Existing in Korea now are uncompetitive industries. The country needs an extensive structural reform. To that end, it's necessary to push ahead with reemployment training, social safety networks and a redeployment of industrial manpower. Strong leadership is needed to lead successful changes. The people and the leaders together should create a new growth mythology.

William Oberlin, President, AmCham Korea: The world now perceives South Korea as a militant trade union republic. When only 12 to 13 percent of the employees are unionized, how are labor disputes so serious? The disputes have brought about too a horrible outcome of a significant cut in foreign investments.

Jeffrey Jones, ex-President, AmCham Korea: The labor laws are currently centered on manufacturing industries. For the Korean economy to shift from the manufacturing to the service industries, the laws should be changed. When manufacturing firms are going to adopt a five-day workweek, for instance, how can restaurants adapt themselves to a five-day workweek? New rules reflecting the reality are needed. Sixty percent of those employed in Korea are non-regular workers, an undesirable phenomenon. Companies hire non-regular workers because no worker layoff is granted in the labor laws. As a consequence, unionists with big firms may be happy, but the children of non-unionists are stuck being contract workers. Even local autonomous bodies employ non-regular workers. Secondly, there is a saying: "Koreans can put up with hunger, but cannot put up with bellyaches." Such an attitude should be gotten rid of quickly.

Lee Sam-hwi: When a labor dispute takes place in a factory, no traces of law and principles are to be found. When unionists perpetrate illegal acts, law enforcement authorities seldom extend cooperation. The head office cannot understand local operations' reports that unionists cannot be punished even if they have committed illegal activities. Suppose we, faced with a labor dispute, have requested intervening by law enforcement authorities. Then the police say: “If we don't appear at the scene of dispute, we are not subject to reprimand; if we intervene, however, we are liable to be reprimanded for a forceful intervention." How can we report such reality to our head office? In addition, Koreans pay little attention to law violations by unionists.

Oberlin: Korea has a short history of legalized demonstrations. One could hardly imagine labor disputes in the 1970s and 1980s, an indication of severe suppression of the union movement. Labor-management relations have remarkably developed in the past 15 years, accompanied by side effects. The behavior of the Korean trade unions, however, must change. The unions should look squarely at the fact that their irrational acts chase away foreign investors and markedly lower productivity.

Blajik: The trade unions don't realize that the biggest loss Korea sustains from labor disputes are customers. Customers lost in labor disputes never return. They run off to China or Southeast Asia in an effort to find new clients. In negotiations with the union, we've never encountered an instance in which the union considers the position of our customers. They demand more pay and a brighter future for themselves; they never consider their customers.

Oberlin: Managers, too, should endeavor to establish a mature labor-management relationship. They should explain to the union the managerial situation in detail, and make efforts to make unionists harbor a sense of belonging to the company. Improper treatments should be rectified; transparent management enforced. The royal road calls for thinking globally and acting as Koreans. This won't be easy, though.

Jeffrey Jones: Unlike other countries, Korea requires more expenses and efforts on labor relations. Koreans are not as rational as they are emotional. To convince the union emotionally, one has to make more explanations than otherwise. Accordingly, foreign firms see that Korean productivity is low. Once they agree emotionally, however, Koreans are different. They achieve better unity and exert more explosive power than any other people in the world. It's troubling that American and European headquarters don't understand such a feature peculiar to Korea.

Lee Sam-hwi: The unions appear to be positive toward participation in management, This is difficult for multinationals to accept. Union members understand why it is difficult for them to take part in management, but this sentiment is not shared by union leaders. If unionists lose their jobs, what can the union leadership help? In this respect, the union leadership is irrational. Union leaders appear to be indulged in making unions into a political force, putting weight on ideologies rather than on workers' welfare.

Oberlin: The American Chamber of Commerce in Korea has fully conveyed to the Korean government its views on the improvement of labor relations. If the administration has formulated plans in the past six months, coming six months are a period to implement the plans. President Roh Moo-hyun is aware of the absolute need of improving labor relations. Let's wait and see.

Blajik: The present policy direction of the Korean government is fine; fears and uncertainties remain, however. The government policy needs a re-alignment, I think. The government should give a consistent message. I wish to see the government move in perfect order to attain established goals.

Lee Sam-hwi: It's frustrating that Roh's messages are not delivered to the bottom echelons properly. When a business firm asks the Ministry of Labor or the police for help, we are told: "President Roh's message is confusing as to whether it calls for helping an enterprise or siding with the union."