Influx of Foreign Labor Leads to Harsh Lessons for South Korean Bosses

With their own countrymen less willing to do the dirty work of their booming economy, South Korean businessmen are slowly, sometimes painfully, learning the lessons of working with foreign labor.

Lesson No. 1: Don’t beat the help, either here or at factories set up abroad because of labor shortages at home.

In August, the Korean manager of a Korean-owned shoe factory in Vietnam’s Ho Chi Minh City was convicted of abusing her workers. She received a suspended prison sentence for lining up and beating employees with an unfinished shoe.

The captain of a Korean tuna boat fishing in the South Pacific suffered a much worse penalty: Mutinous Chinese crewmen tossed him and 10 other sailors into the sea to die. Police said the mutiny erupted after the captain beat a Chinese worker for not doing his job.

Corporal punishment was accepted in the workplace in Korea in the 1960s and ‘70s, but its use diminished after many of the nation’s industrialists and students went abroad in search of profit and education and learned more about other cultures. That sophistication, however, is not always found in smaller firms, which employ a majority of foreigners in South Korea.

And it shows up overseas, where conflict from racial and cultural differences has earned Korean bosses a harsh reputation in places ranging from Vietnam to Pakistan to Guatemala.

But business and government leaders are beginning to realize that Korean managers need better training on dealing with foreign workers if the country’s economy is to continue growing.

Rapid economic development in recent decades has lifted wages, education levels and expectations in this nation of 44 million people, leaving fewer willing to do what Koreans call the “3-D” jobs--dirty, difficult, dangerous.

To find workers, South Korean businesses have turned to other nations. In some economic sectors such as fishing, textiles and manufacturing, acute labor shortages have forced companies to violate a law requiring them to limit foreigners to a maximum 50% of their staffs.

The national fishing cooperative says there are 53,000 coastal fishing jobs and only 42,000 Korean fishermen. The Korea Federation of Textile Industries says it cannot fill 14.7% of its jobs, up from 11.8% at the end of last year.

About 20% of heavy-manufacturing jobs are empty at small- and medium-size businesses. The Small and Medium Business Administration, which deals with companies of 300 or fewer employees, reported that some sectors, such as plastics and electrical machinery, lack nearly 30% of the desired work force.

In 1994, the government began a program to allow foreign workers to fill some of those jobs. An estimated 170,000 foreigners are believed to be working in South Korea, 70,000 of them illegally.

Industry officials are asking the government to allow even more foreigners to come, although they acknowledge there is difficulty dealing with the ones already in South Korea.

Business owners say their main problem is that once settled in Korea, the foreigners, hired to keep costs down, start demanding higher wages or jump to other companies to get them.

“There were some problems, frictions, arising from cultural differences, but very few now,” said Han Sang-woo, owner of an embroidery company whose 11 employees include six Filipinos. “They are mainly here for money. So if we give more money, that buries other problems.”

For foreign workers, the biggest problems are poor living and working conditions, substandard wages, and sometimes abuse.

“There are cultural differences, and maybe Korean managers do not treat them too well,” said Kim Kyung-man, an official in the foreigner-training office of the Korean Federation of Small Business.

The government has announced several proposals to address problems with foreign workers. These include improving local training programs for foreigners, cracking down on immigrants who commit crimes, and establishing a new system to track and supervise foreigners throughout their stay in Korea.

Overseas problems, such as the beating in the Vietnam shoe factory, prompted the government to post a labor attache in the country. Briefings on Vietnamese culture and work attitudes are being made available to Korean businessmen who go to that country.

“The whole issue of labor relations is one of the critical ones Koreans are trying to face reluctantly,” said David Steinberg of the U.S.-based Asia Foundation, a think tank on Asian issues. “It’s a matter of foreign policy, not just business.”