KB News Desk
President Lee Jae Myung on Friday warned foreign companies operating in South Korea against unfair labor practices, saying his administration would investigate allegations thoroughly and take strict action if violations are confirmed.
The warning came after a local media report alleged labor rights violations at Ikea Korea.
In a social media post, Lee said some global companies with strong reputations overseas have faced criticism in Korea over what he called anti-labor practices and opaque management.
“Just as Korean companies should not engage in such practices abroad, foreign companies should not do so in Korea,” Lee wrote.
Lee was referring to a report alleging that Ikea Korea demoted an executive-level employee to a nonmanagerial position after the employee returned from parental leave.
According to the report, the personnel move came during an organizational restructuring, and the employee was told to either resign or accept the reassignment despite a reported assurance from Ikea Korea CEO Isabel Pucci that the position would be maintained.
The report also alleged that Pucci had made disparaging remarks about Korean employees, saying it was difficult to dismiss them.
The case has been under investigation by the Anyang branch of the Ministry of Employment and Labor since April.
Ikea Korea denied all the allegations in a statement.
“The employee remains with the company in the same position and role,” the company said. “The employee’s employment status has also remained unchanged.”
The company also rejected speculation that the restructuring was part of a downsizing plan or preparations to withdraw from Korea amid declining profitability.
Ikea Korea said the restructuring was part of a global operational change affecting Ikea organizations worldwide, including Korea. According to the company’s financial disclosure, its operating profit for the fiscal year ending September 2024 fell 41.3 percent from a year earlier to 10.9 billion won ($7.2 million).
Lee’s remarks come as labor disputes involving foreign companies have drawn growing public and political attention.
In January, the Seoul Regional Labor Relations Commission ruled that Finnair had unfairly dismissed five Korean cabin crew members, finding that they should have been recognized as indefinite-term employees under Korean law after working for more than two years on successive fixed-term contracts.
Lee said what he described as unfair labor practices tolerated under previous administrations would no longer be accepted.
“If the allegations are confirmed through a thorough investigation, we will take strict action in line with international standards,” he wrote.
