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Hyundai Motor union calls for strike as wage talks stall

According to Yonhap News,

(ULSAN/BUSAN=Yonhap News) Hyundai Motor Co.'s labor union called for a strike late Tuesday after it failed to make headway with management on standard wage and other workers' benefit issues, its officials said.


The decision was reached late Tuesday at a meeting of union representatives at the automaker's main production plant in Ulsan, one of South Korea's largest industrial cities 414 kilometers southeast of Seoul.

The matter will be put to a vote on Thursday with the company's 47,000 unionized workers asked to approve or reject the strike. Union insiders said the motion is expected to pass because there is almost no chance of workers rejecting a call made by its leadership in regards to a strike.

A walkout could seriously affect production of South Korea's largest automobile manufacturer. Of Hyundai's total output capacity of 4.83 million units forecast for this year, 39 percent, or 1.87 million cars, are to be made on the company's home turf.

The company has been quick to point out that all bonuses given to employees in the past, while given at regular intervals, were never offered unconditionally or uniformly, with workers required to work for a set period of days in order to receive the bonuses. Such conditions, management claims, do not meet the criteria of the December ruling.

The National Labor Relations Commission (NLRC) decided to stay out of the issue, saying Monday that it cannot mediate standard pay issues as requested by union representatives at Hyundai Motor. It urged the union and management to discuss their differences in accordance with the 2012 agreement.

In addition to the standard wage standoff, the union has demanded an 8.16 percent, or 159,614 won (US$155), monthly increase in wages, and the unconditional raising of the retirement age to 60 without implementing a wage peak system as recommended by the government. It also called for a bonus equal to 30 percent of the previous year's net earnings.

In 2013, the company's bottom line was tallied at 8.99 trillion won, which means workers want 2.69 trillion won in bonuses.

Unionists, moreover, called for the reinstatement of workers fired for engaging in illegal strikes and dropping all legal actions against them.

Management has said such demands were excessive and that they cannot be discussed at the CBA talks.

"Hyundai Motor is an important player in the national economy and every effort must be made to prevent a strike that can cause a halt in production and have far-reaching side effects for the company's parts suppliers and other partners," a company executive said.

The country's labor ministry said that as the NLRC rejected to intervene in the negotiations, Hyundai's union must engage in related talks with management before its members can legally go on strike.

"Failure to follow set rules will mean any strike will be illegal and result in legal actions being taken," authorities warned.

In regards to wage talks under way at Hyundai's smaller corporate cousin, Kia Motors Corp., company sources said negotiations are still ongoing, although no breakthrough has been reached.

"In the past, Kia's union usually followed the lead taken by its partners at Hyundai, so there is a strong likelihood of its labor leaders calling for a strike and asking its workers to vote on the matter," said an insider, who declined to be identified.

Besides the country's two leading carmakers, Renault Samsung Motors Co., (RSM) the local unit of French automaker Renault S.A., said partial walkouts that began on July 14 have already cost the company 16 billion won in terms of missed production as of last week. It said if the planned 20 hours of strike takes place as scheduled this week, the total losses could top 36 billion won. The amount reflects some 1,860 cars that will not be made.

"Demands being made by union workers who want a say in personnel management and promotions cannot be accepted, especially since RSM must take into account standards practiced in other Renault and Nissan plants around the world," a senior manager-level insider said.

He said that while unionists are demanding a 64,000 won increase in basic monthly pay and 5 million won in a lump sum payment, these demands require negotiations.

"Already, RSM plant workers have the second-highest wage within the Renault Group, so asking for more may not be well received," the source said. Only Renault workers in France are paid more.

The company, citing difficult times, had frozen wages in 2012 and 2013.

The abrupt call by workers on Friday to demand bonuses be included in pay has further complicated talks.

The company said that if workers continue to disrupt production, the company could lose customers that have lined up to buy the SM5 diesel sedan. It added that the walkout could hurt production of Nissan Rogue SUVs from its Busan plant that are scheduled to be shipped to the United States.

Copyrights Yonhap News. All Rights Reserved.

Source Text

Source: Yonhap News (August. 13, 2014)