POSCO union warns of indefinite strike from the 2nd of next month, raising concerns over production disruptions

[Financial News] With POSCO’s union warning of an indefinite strike from the 2nd of next month following the breakdown of wage negotiations, attention is focused on the potential impact on steel production and deliveries to customer companies. Labor action is escalating after two partial strikes last month, and if a strike is prolonged, it is expected to place a burden on operations at the Pohang and Gwangyang steelworks.
According to industry sources on the 25th, the POSCO Labor Union, part of the Federation of Korean Metalworkers’ Trade Unions under the Federation of Korean Trade Unions (FKTU), plans to launch an indefinite strike and gradually expand its actions starting at 7 p.m. on November 2. The union and management held wage negotiations at the company’s headquarters in Pohang on the 23rd, with POSCO President Heegeun Lee and union chairman Kim Seong-ho among those attending, but failed to reach an agreement.
The key sticking points are the base-pay increase and the size of compensation. The union is seeking a 7.1% base-pay raise, a 600% incentive payment, 50 employee stock ownership shares, and holiday bonuses of 200%, among other demands. Management, by contrast, offered a 2.5% base-pay raise and a lump-sum payment of 5 million won. The gap between the proposed base-pay increases is 4.6 percentage points.
The union previously held partial strikes for 48 hours from September 9 to 11 and for 120 hours from the 16th to the 21st. Management put forward a 2.2% base-pay increase on the 14th of this month and raised it to 2.5% on the 22nd, but the union declared that negotiations had broken down on the 23rd. Starting on the 26th, the union plans to gradually step up its labor action, including restricting some members from responding to unexpected work requests after their shifts.
The key question is whether the strike will actually disrupt production. Steelworks have multiple processes, including ironmaking, steelmaking and rolling, linked in a continuous sequence, so production plans may need to be adjusted depending on the extent of strike participation and its duration. In particular, if labor action spreads to major production lines and continues for an extended period, it could also affect product output and shipping schedules.
However, a strike announcement does not necessarily mean production will immediately stop. POSCO says it will adjust production plans and activate its emergency operations system to minimize the impact on customer companies and domestic demand industries.
Whether the union and management can narrow their differences through further negotiations before the strike begins is another key factor. Management says it will continue talks despite the union’s declaration that negotiations have broken down.

[email protected] Kim Mi-hee Reporter