SEOUL, Korea, Republic Of -- Thousands of South Koreans marched in Seoul for the second straight day Saturday to protest government labour policies and the handling of a ferry disaster that killed more than 300 people a year ago.

Thousands of demonstrators supporting the relatives of ferry disaster victims gathered for a rally on the same downtown street where they violently clashed with police last weekend, leaving dozens injured.

They were joined by some of the estimated 40,000 unionized workers who had demonstrated in front of the Seoul City Hall hours earlier to denounce government policies that they fear will reduce wages, job security and retirement benefits for state employees, said Park Seong-shik, a spokesman for the Korean Confederation of Trade Unions.

Hundreds of people marched in silence from several locations to participate in the rally, many of them wearing face masks and yellow scarfs and jackets, the colour that has come to symbolize the plight of the families.

A large number of police officers closely watched the demonstrators, many of them wearing helmets and body armour and holding riot shields. Dozens of police buses were parked nearby, as were some vehicles that appeared to be equipped with water cannons.

South Korean police often use their vehicles to create tight perimeters to block protesters from advancing, as they did last week when more than 70 police buses were destroyed.

The ferry disaster continues to haunt the presidency of the increasingly unpopular Park Geun-hye, despite her bowing to relatives' demands to proceed with a difficult and potentially dangerous operation to salvage the 6,800-ton ferry.

In addition to the salvaging of the ship, relatives have been calling for a new investigation into the government's responsibility for the disaster. They accuse Park of ignoring the alleged incompetence and corruption they believe contributed to the sinking and high death toll.

A total of 304 people, most of them students from a single high school, died when the ferry Sewol sank off South Korea's southwest coast on April 16, 2014.

Prosecutors blamed negligence by crew members, excessive cargo and improper storage for the sinking, along with slow rescue efforts. Relatives of the victims claim the investigation was insufficient because they believe high-level authorities weren't held accountable.