OKPO, SOUTH KOREA, AUG. 26 -- The giant Daewoo shipyard here reached a tentative agreement with striking workers this evening in a bid to settle an emotional dispute that led to the death of a young laborer last week.

If rank-and-file workers accept the accord after 18 days of conflict, they will end one of the most bitter stoppages in a summer of labor unrest, and one that has taken on national political significance.

The young worker killed by riot police while demonstrating against the shipyard last Saturday here on the southern island of Koje still has not been buried, as relatives and labor and dissident leaders debate whether to turn his death into a national cause.

The government, fearing such a development, urged Daewoo and other employers to compromise on wages while warning with increasing insistence that dissidents should stay out of labor disputes.

Officials announced today that a special Cabinet session will be held Thursday to devise measures to keep such "impure elements" from intervening in worker disputes.

"We cannot but be concerned about their attempts to arouse national chaos with labor protests," the ruling party said in a statement.

Five former university students were arrested yesterday for helping to organize labor strikes at an electronics plant near Seoul.

In another effort to undercut street protests, government and opposition politicians quickened their negotiations to shape a new constitution leading to free elections later this year. Officials want to have a final draft agreed upon by early next week, when university students, many of whom are dissatisfied with the pace of democratization, return from summer vacation.

Today, the government dropped its insistence on a five-year residency requirement for presidential candidates. This would have excluded opposition leader Kim Dae Jung.

In return, the opposition Reunification Democratic Party softened its insistence that the constitution's preamble guarantee the right to resist unjust governments and the duty of the military to stay politically neutral.

Remaining issues, including voting age and presidential power to dissolve the National Assembly, are expected to be resolved this week, with ruling party chairman Roh Tae Woo and opposition leader Kim Young Sam sealing the pact in a meeting on Monday.

Roh kicked off the process on June 29 when, in response to 20 days of widely supported student street demonstrations, he promised direct elections and other reforms. The prospect of increasing democracy after years of authoritarian rule has inspired laborers, who have struck more than 1,900 companies since June 29.

Workers at this isolated shipyard, surrounded by terraced rice fields and fishing villages, said they are fighting for respect and dignity as much as for money. This is a company town, where blue-collar and white-collar workers live side by side, and the welders and forklift operators said they constantly see evidence of unequal treatment.

"White-collar workers are part of the family; blue-collar workers are animals," one worker said. "We just want to be treated like human beings."

Workers complained that children who can afford to wear Nike sneakers become teacher's pets in the Daewoo company school, that white-collar wives refuse to associate with blue-collar wives, and that company inspectors treat workers with contempt.

"Our level of understanding of reality has changed," one union leader said. "We are no longer subordinates. We are willing to work with our employers."

Without question, though, money is a major issue here. Beginning workers earn about $260 per month, with their salaries rising to about $400 after several years.

The tentative agreement worked out last night would provide a monthly raise of about $56.