First Labor-Management Meeting Since Rehabilitation Plan Approval...Can Homeplus Find a Path to Recovery?

[Financial News] Homeplus has met with its labor unions for the first time since the court approved its rehabilitation plan. With numerous challenges—including recovering sales, managing its workforce, and resolving unpaid wages—the meeting has drawn attention to what recovery measures management will propose.
According to industry sources on the 15th, Homeplus will hold closed-door meetings with the General Workers’ Union and the Mart Workers Union at its headquarters in Seoul’s Gangseo District. The meeting with the General Workers’ Union is scheduled for 1 p.m. to 3 p.m., followed by a meeting with the Mart Workers Union from 4 p.m. to 6 p.m. This is the first time labor and management have officially met since the court approved the rehabilitation plan on the 2nd.
The discussions are expected to cover a broad range of issues, including the implementation of the rehabilitation plan, sales trends since operations resumed, workforce management, and future recovery plans. Homeplus resumed operations a month ago, and about two weeks have passed since the court approved the plan.
A representative of the Homeplus General Workers’ Union said, "We will probably have to meet with management to find out the specific details," adding, "We plan to check how sales performed over the past month and whether management has the capacity to repay its debts to creditors."
Although court approval of the rehabilitation plan helped Homeplus avoid an immediate bankruptcy crisis, observers say the company still has a long way to go before achieving substantive management normalization. Stable sales recovery is considered the key issue, but given current operating conditions, some believe it will be difficult to significantly increase sales in the short term.
According to Homeplus, total sales from the 13th through the 30th of last month, after operations resumed, amounted to 116.4 billion won. On a simple calculation, that translates to average daily sales of about 6.5 billion won. In its rehabilitation plan, however, Homeplus set a goal of returning to profitability in 2029 and achieving sales of 4.3 trillion won in 2030. Dividing annual sales of 4.3 trillion won into a simple daily average results in approximately 11.8 billion won.
Industry sources believe that average daily sales subsequently declined somewhat from the initial level, considering that demand temporarily surged immediately after reopening. The company’s failure to resume gift-set sales ahead of the Chuseok peak shopping season is also cited as a factor limiting sales recovery.
Alongside sales recovery, workforce management is another major issue. Homeplus reduced its workforce to around 9,000 employees through rehabilitation proceedings and voluntary retirement programs. However, following the closure of 37 stores, a significant number of employees remain on leave. The number of idle workers is reportedly as high as 4,000.
Unpaid wages also remain an issue that must be resolved. According to data submitted by the Ministry of Employment and Labor (MOEL) to the office of Kim Wi-sang, a People Power Party lawmaker on the National Assembly Committee on Climate, Energy, Environment and Labor, Homeplus’s cumulative unpaid wages totaled 387.1 billion won from December last year through August this year. The figure is far higher than the 119.7 billion won in cumulative unpaid wages recorded by WINIA GROUP, which was considered the largest amount ever for a single company. Following MOEL’s guidance on clearing unpaid wages, Homeplus paid 320.7 billion won of the total, but the remaining 66.4 billion won, or 17.2%, has yet to be settled.
As a result, the meeting is expected to provide an indication of the direction and pace of Homeplus’s future management recovery, including how it will address the numerous outstanding issues involving sales and its workforce.
Ahn Su-yong, head of the Homeplus Branch of the Mart Workers Union, said at a press conference the previous day, "The path to rehabilitation has been opened, but this is not the end. True normalization starts now," emphasizing, "Customers need to return and sales need to recover. Ultimately, we must find a good buyer and achieve a complete recovery."
[email protected] Jang Yu-ha Reporter