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Korea's labor unions are known for militancy, resulting from past political repression and economic inequality. Since the 1960s, Korea achieved remarkable economic growth due to cheap labor and skilled workers. The government's "development first and distribution later" policy led to labor policy becoming part of the economic agenda. Labor issues gained importance in the mid-1970s, with workers demanding better conditions and fair share of economic success. The "Ulsan Typhoon" in 1987 marked a turning point, with 1.3 million unionized workers demanding equal wealth distribution and better conditions.

The government improved labor-management relationships in the 1990s by institutionalizing a minimum wage system and reducing working hours. The Tripartite Commission was established in response to the 1997 financial crisis, with leaders from management, labor, and government working together to discuss ways to overcome the crisis. Union leaders accepted mass layoffs, understanding they were inevitable.

Only a small portion of Korea's workforce is unionized, with a unionization rate of 11% in 2000 and 10.4% in 2004. Most trade unions are affiliated with the Federation of Korean Trade Union (FKTU) or the Korean Confederation of Trade Unions (KCTU). The number of industrial disputes increased sharply in 1987, but declined in the mid-1990s before rising again after the Asian financial crisis.

Korea's labor leader has promoted foreign direct investment (FDI), acknowledging the need to attract FDI to revive the economy and create new jobs. The FKTU signed an "Agreement on Joint Cooperation to Promote FDI" with the Korea Trade Investment Promotion Agency (KOTRA), showing a willingness to work cooperatively to attract FDI and promote national interest.