1. Recent Developments in Employment and Labor Policies Lee, Chaepil Minister of Employment and Labor of Korea

2. Korea-EU: A long-standing friendship upon supreme sacrifice Korea-EU: A long-standing friendship upon supreme sacrifice From Security to Economic Alliance ! UN engagement during the Korean War, - Combat Forces : UK, Netherlands, France, Greece, Belgium, Luxembourg - Medical aids, relief supplies, etc : Sweden, Denmark, Norway, Italia Korea-EU FTA comes into effect on Jul. 1, 2011. - real GDP up by 5.6 %, additional 253,000 jobs by 2021 (expected) 1

3. Labor market at a glance More on payroll, led by private sector and regular jobs * Yearly changes (thousand people): 145 (08) → -72 (09)→ 323 (10) Unemployment rate in major countries (May 2011): Korea (3.2%), Japan (4.9%), Germany (6.0%), US (8.7%), France (9.2%). Average utilization rate in manufacturing: 77.5% (08) → 74.6% (09) → 81.2% (10) → 84.8% (Jan. 2011)→ 82.5% (preliminary, Mar. 2011) (y-o-y) 400 0 -200 -400 08.7 09.1 10.1 7 09.7 (1,000 people) Changes in the number of the employed 11.1 200 78 112 153 -10 -76 -219 473 586 267 5 71 455 331 23 469 45 379 355 2

4. Labor market at a glance Employment not fully back on track: (many people see employment has not improved much) Hard-to-place group* ’10.5’08.5’09.5 (1.000 people) 1,479 1,935 ’11.5 1,818 Employment rate ’08.5 ’09.5 ’10.5 ’11.5 (%) 64.6 63.4 60.1 64.3 60.0 59.3 60.5 64.7 Aged 15 or above Aged 15-64 * Referring to those with less access to the labor market 3 1,797

5. Employment Policy Framework The 2020 National Employment Strategy Decent Part-time Jobs Youth My Work Project On-Site Job+Team Job Creation In the Context of  Actual Needs of People (Employers, Employed, Job-Seekers)  On-site Concerns 4

6. Sharing opportunities with more people 5

7. (’ KRW 23.2 bil. In 2011, yearly KRW 7.2 mil. per newly employed) Working Hours Reduction Training & Sabbatical leaves Work-shift schemes 근로시간 단축 Parental leave subsidies, Substitute worker subsidies Parental leave allowed for children aged six or under (up from age 3) Child- rearing Work Labor Cost Support Labor Cost Support New Recruitment New Recruitment 6

8. Sharing opportunities with more people Working Hours Reduction 40 Hour Work WeekExpanding the 40 Hour Work Week to workplaces with less than 20 employees (from July 2011) Encouraging the use of annual leaves; introducing family-friendly leave system (law will be amended within 2011) Applying less exceptions to standard work hours (LRC will discuss the issue in 2011 agenda) Flexible Work Hour Scheme Working Hours Savings SystemIntroducing the Working Hours Savings System Expanding flexible working hours arrangement (from 2 weeks to 1 month, from 3 months to 1 year) Expanding the eligibility of discretionary work scheme (to include software developers, etc.) 7

9. On-site Job+ Team “Job Creation” Deliver more information Support for job creation and retention Listen to On-site concerns Difficulties i.e., hard-to-fill vacancies Offer Solutions Job-placement Efforts, deregulation 8

10. Stabilized Industrial Relations No. of disputes No. of lost working days Paid Time-off System 86 cases ( bargaining unit basis) Record-low (28.9% down) 30.2 days ( per 1000 workers) 89 % ( application) OECD Avg. = 34.7 days (2006-2008) 99% (Compliance rate) Rule of Law Principle of Autonomy 9

11. Introduction of Multiple Trade Unions ★ Guarantees workers’ right to “association” ★ Enhances “constructive competition” among trade unions Multiple Trade Unions ★ Workplaces likely to have multiple trade unions within a year: 11% (KEF), 7~14% (KLI) ★ Likelihood of turning confrontational or non-amicable industrial relations to more cooperative relations: 83.3% (KLI) Expected Changes 10

12. Single Bargaining Channel Autonomous Selection Majority Rule Joint Bargaining Representative Team ★ Select a single ‘bargaining representative union’ from among trade unions to engage in collective bargaining with management ▶ Prevent confusion in the collective bargaining process Step 1Step 2 Step 3 11

13. For Soft-landing Offer education & consulting services Carry out PR activities 1 Monitor workplaces Issue correction orders when necessary 2 Reinforce the LRC’s capacity Revise related rules and regulations 3 12

14. Job-friendly Industrial Relations Upgrading via multiple unionism Constructive Options&Ideas, Fair Competition High performance workplace, Socially responsible Workplace Multiple Trade Unions 13

15. Job-friendly Industrial Relations Socially Responsible Labor and Management; ‘Achieve win-win cooperation via a fair sub-contraction agreement’ (Hyundai Heavy Industries) “Set aside a matching fund to finance socially responsible activities, and ensure no age discrimination targeting the elderly” (LG Electronics Corp.) care more for SMEs, subcontracted workers and non-regular workers 14

16. JOBS