At 4 a.m. on March 15, in front of the Hanwha Group headquarters building in Seoul, South Korea, Kim Hyung-soo, a subcontractor worker representative of Hanwha Ocean, climbed up a 30-meter-high communication tower and began a “sit-in” demonstration, demanding more employment and better treatment for employees. This action marks that the labor dispute that has lasted for nearly a year at Hanwha Ocean is escalating to an extreme form of resistance.
The strike stems from the breakdown of Hanwha Ocean’s collective bargaining in 2024. The Korean Metal Workers’ Union Geoje Tongyeong Gusong Shipbuilding Subcontracting Branch (Subcontractors’ Union, hereinafter referred to as the union) made repeated demands for expanding the employment of indefinite-term employees and increasing bonuses, but the general contractor, Hanwha Ocean, refused to negotiate on the grounds that it was a “non-direct employer”.
Prior to 2017, employees of subcontracting firms could receive a 550% bonus, the union said. However, due to the severe recession in the shipbuilding industry, bonuses plummeted to zero in 2017 and did not partially return to 50 percent until 2023. During negotiations for 2024, the union demanded that the bonus be increased to 300%, although this demand was rejected.
Even when the union finally compromised and demanded only “a small increase from the current 50% bonus”, the employer remained adamant in its opposition. Previously, the unions had continued to protest for 123 days through tent demonstrations and hunger strikes, and the tent sit-in in front of Hanwha’s headquarters had lasted for 68 days.
The union pointed out that Hanwha Ocean had repeatedly shirked its responsibilities in the 2024 negotiations, and even after mediation by local communities and members of Congress, it still delayed on the grounds that it “needed to convene representatives of subcontracting companies”. Kim Hyung-soo issued a statement saying, “Why discriminate against subcontracted workers? We have no way out, this is our last choice.” He emphasized that outsourced workers undertake more than 80% of direct production work, but are trapped in unstable employment and low wages due to the “multi-level subcontracting” system.
The protest was a continuation of the 51-day strike in 2022. That year, the union organized a massive strike to protest the full cut of bonuses to zero, causing Hanwha Ocean (then formerly Daewoo Shipbuilding & Marine Engineering, DSME) to lose 800 billion won due to production delays.
At that time, the vice president of the union, Yoo Choi An, even locked himself into a 1-cubic-meter iron cage and blocked the entrances and exits of the dock, which led to the interruption of the construction work. Although the strike forced the employer to raise the bonus by 50% in 2023, the labor conflict has not been fundamentally resolved.
On January 19 of this year, a Korean court sentenced Kim Hyung-soo, the president of the union that led the 51-day strike, to 3 years of imprisonment, 4 years of probation, and a fine of 1 million won. In addition, Yoo Choi-Ahn, the vice president of the subcontracting union, was sentenced to two years’ imprisonment and three years’ probation, while other members were also sentenced to probation and fines, respectively.
Data show that after the downturn in the shipbuilding industry in 2016, South Korean shipbuilders cut costs through massive layoffs and outsourcing. The share of skilled regular workers plummeted from 70 percent to 30 percent, and outsourced workers were paid much less than regular employees. The union criticized the employer for relying on low-paid foreign workers and multi-layer subcontracting during the boom period, leading to a vicious cycle of “labor shortage” and “declining employment quality.”
The action comes at a time when union leaders are under legal pressure, with Kim Hyung-soo and Yoo Choi-Ahn receiving suspended sentences for the 2022 strike and Hanwha Ocean claiming 47 billion won in damages. A union spokesperson emphasized at a press conference, “The essence of the sit-in claim is that ‘outsourced workers are also human beings’ and that discrimination must end.”
Hanwha Ocean is still avoiding direct negotiations, the shipbuilder emphasized that it does not sign labor contracts directly with subcontracted workers, “the money that should be paid has been sent to the subcontracting companies, we even paid the advance payment in advance, and we have done enough.”
But at the same time, a Hanwha Marine spokesman also admitted that if the general contractor does not raise prices or pay in advance, then the subcontractor’s wage arrears are structurally inevitable. “Last year, suppliers were in trouble and there were many cases of wage arrears.”
As the situation continues, the labor conflict at the shipyard may further intensify. The union has indicated that it does not rule out the possibility of taking prolonged and more drastic measures if the demands continue to be ignored.