Conflict between labor and management in South Korea’s shipbuilding industry continues as unions are raising the level of struggle to pressure employer, with wage and collective agreement negotiations expected to last longer in 2024.
On September 25, HD Hyundai Heavy Industries proposed the 25th round of negotiations aimed at negotiating with the company’s labor union on a number of terms, including basic wages and employee benefits.
In the 25th round of negotiations, HD Hyundai Heavy Industries proposed to increase the basic wage by 122,500 won (about $93.34, including pay raises), give out 4 million won (about $3,048.00) in bonuses and 300,000 won (about $228.60) in gift certificates, and establish a new performance bonus for non-serious accidents, etc. However, the proposal was rejected by the labor union and the suspension of negotiations was announced.
This is the second proposal made by HD Hyundai Heavy Industries to its labor union. The first proposal, which was presented on September 5, included a basic wage increase of 102,000 won (about $77.72, including raises), a 4 million won incentive bonus and performance bonus, raising the age for comprehensive medical checkups, as well as a proposal to invest 2 billion won (about $152.40) in the operation of recreational facilities, and the operation of specialized labor-management councils for the improvement of the personnel system, among other things.
In comparison, HD Hyundai Heavy Industries has increased the basic wage by 20,500 won and added 300,000 won in gift certificates and changed the performance bonus rate based on the first proposal. However, this did not meet the expectations of the union, which demanded a 159,800 won ($121.77) increase in the basic wage and an extension of the retirement age to 65 years old from the current 60 years old.
As a result, the HD Hyundai Heavy Industries Union rejected the proposal as not meeting the expectations of its union members and announced the suspension of negotiations. In response, union officials explained, “The company did not accept any of the union’s demands to improve the welfare and working environment of its members. The impasse in the negotiations was due to the company’s strategy of sabotaging the negotiations.”
After rejecting the employer’s second proposal, the HD Hyundai Heavy Industries Union staged a four-hour strike on the 25th in order to demand a forward-looking proposal from the management, marking the union’s seventh strike since its first partial strike on August 28th. On the same day, the HD Hyundai Heavy Industries Union held a press conference in order to condemn the management. The union claimed, “On Sept. 10, HD Hyundai Heavy Industries security personnel beat up union members who were carrying out legal strike activities inside the company. We demand an apology and the prevention of the recurrence of such an incident.”
In response to the union’s complaint, HD Hyundai Heavy Industries explained, “As the union was carrying out illegal activities such as trespassing and vandalism of facilities, a clash occurred during the protection of the majority of employees who were not participating in the strike. During this time, an employee of the company’s security team was struck in the face by a spray can thrown by the union and sustained serious injuries that required surgery.”
HD Hyundai Heavy Industries has now filed a police complaint against the union for special assault and obstruction of normal work.
In the course of this year’s negotiations, serious physical clashes broke out between labor and management at HD Hyundai Heavy Industries, and the industry is worried that the negotiations will be protracted due to differences in the proposal. In particular, it is not unlikely that the unions will decide to suspend negotiations, put more pressure on the employer, and announce a seven-hour partial strike on September 27, the eighth strike of the year. The union will not negotiate until further proposals are made by the employer.
As the HD Hyundai Heavy Industries union rejected the second proposal, the employer said, “It is very unfortunate that the union has rejected the best second proposal in the industry without even consulting its members. Since the majority of union members want an early conclusion to the negotiations, the union should do its best to negotiate rather than strike to reach a contract agreement.”
In addition to HD Hyundai Heavy Industries, Hanwha Ocean is still facing major disagreements between labor and management after more than 20 rounds of negotiations. Previously, Hanwha Ocean made proposals such as an 87,000 won (about $66.29) increase in basic wage and a one-time payment of 2 million won (about $1,524), which were rejected by the union. Meanwhile, Hanwha Ocean’s labor and management are at odds over major issues such as whether to pay RSUs. Its labor unions have been engaged in commercial strikes and partial strikes.
Among the three largest shipbuilding enterprises in South Korea, only Samsung Heavy Industries has reached a tentative agreement between labor and management, with its labor union accepting the employer’s proposal to increase basic wages by 115,260 won (about $87.83) and 3 million won in bonuses (about $2,286), etc.
In addition, the Korean shipbuilding industry 26 news, the the Korea Federation of Korean Metal Workers’ Trade Unions (KOSHU) announced that it will hold intensive negotiations until October 11, and if the negotiations fail, it will launch a second general strike on November 16th. The federation includes HD Hyundai Heavy Industries, HD Hyundai Samho, HD Hyundai Mipo, Hanwha Ocean, Samsung Heavy Industries, HSG Seongdong Shipbuilding, K Shipbuilding, and HJ Heavy Industries, eight shipbuilding labor unions.
