HD Hyundai Heavy Industries Labor Talks Break Down... Is an All-Out Strike for a Second Straight Year Imminent?

[Financial News] The Hyundai Heavy Industries Branch of the Korean Metal Workers’ Union said on the 18th that negotiations, held daily with the goal of reaching an agreement before Chuseok, had broken down. Concerns are growing that workers could launch an all-out strike for the second consecutive year, following last year’s action.
The Hyundai Heavy Industries Branch of the KMWU announced the breakdown on its website, saying, "It is more important to protect our members’ rights and demands than to hastily agree to an inadequate proposal." It added that the date of the next round of negotiations had not been decided.
HD Hyundai Heavy Industries had earlier presented a third offer centered on a 110,000-won increase in base pay, but the union rejected it. The union then brought forward the schedule and escalated the planned strike for all members. The Shipbuilding Industry Union Alliance warned that the unions of six companies would launch a joint strike if no deal was reached before Chuseok. In response, labor and management held marathon talks every day in an effort to produce a tentative agreement. The negotiations ultimately broke down.
The Hyundai Heavy Industries Branch of the KMWU continues to demand that 30% of operating profits be shared. Although the Ministry of Employment and Labor issued guidelines stating that the issue is not subject to labor disputes, the union is using the demand as leverage in negotiations amid projections that this year’s operating profit could be up to twice last year’s. In practical terms, the union is seeking a larger increase in base pay. It is calling for the salary scale itself to be raised so that operating profits can be shared.
HD Hyundai Heavy Industries maintains that the partial strikes held so far have had little impact on operations because its production processes are separated. However, the company expects some damage if workers launch an all-out strike that disrupts logistics as well, as they did last year. Observers say the union could use a joint strike by the Shipbuilding Industry Union Alliance after Chuseok as a springboard for an all-out strike.
[email protected] Kim Yun-ho Reporter