Partial strike for 7 hours a day from the 19th to the 23rd... Union branch head's sit-in protest rejects 40.56 million won compensation plan... Intensifying conflict over performance distribution and integration
HD Hyundai Heavy Industries (329180) announced a partial strike for all union members for five days amid the boom in the shipbuilding industry. The conflict is intensifying as labor and management failed to reach an agreement even after preparing the largest compensation plan ever, and even the union branch leader entered a high-altitude sit-in protest. The problem of adjusting wages and welfare systems following integration with HD Hyundai Mipo has not been resolved, so it is expected that there will be a burden on production schedule management at shipbuilding sites.
#### The largest compensation plan ever was rejected... Conflict over distribution of base salary and performance bonus
The Hyundai Heavy Industries branch of the Metal Workers' Union plans to hold a partial strike for 7 hours a day for all union members for five days from the 19th to the 23rd. Initially, a 4-hour strike was planned to be held on the 19th and 20th, mainly by union officials, but it was expanded to a 7-hour strike for all union members. The strike scheduled for the 21st to 23rd will also proceed as is.
On the afternoon of the 18th, Kim Dong-ha, head of the labor union's branch, began an indefinite high-altitude sit-in protest by climbing a crane approximately 25 meters high at Daejorip Plant 1 at the Ulsan headquarters. They are demanding expanded performance distribution, integrated collective bargaining, and improved working conditions in response to the boom in the shipbuilding industry.
After continuing negotiations since last June, labor and management prepared the first provisional agreement on September 30. It includes an increase in base salary of 120,000 won, a lump sum of 11 million won and payment of 200% of base salary, separate performance bonuses, and expansion of rewards for long-term employees.
The company estimated the average compensation effect per union member, which includes the basic salary increase, lump sum, and performance bonus, at 40.56 million won. It was the highest level ever, 10.61 million won more than at the time of last year's negotiations, but it was rejected in a vote on the 2nd with 3,932 out of 7,541 voters (52.14%) opposing it.
At the center of the conflict is the method of distributing base pay and performance bonuses. The basic salary increase of 120,000 won in the tentative agreement includes a salary increase of 50,000 won, which is lower than last year's increase of 135,000 won. This falls short of the basic salary increase of 131,786 won at Samsung Heavy Industries, which previously concluded wage negotiations.
The union requested a plan to utilize at least 30% of the company's operating profits as performance bonus resources, but this standard was not reflected in the tentative agreement. There are continued calls to increase fixed pay and expand performance distribution linked to performance, rather than one-time compensation such as lump sums.
#### HD Hyundai Mipo integration conflict... Ship construction schedule burden
After the integration with HD Hyundai Mipo, friction continues in the process of adjusting different wage and welfare systems and collective agreements.
The Mipo Committee, comprised of former HD Hyundai Mipo union members, is protesting, saying that existing working conditions could be regressed. Mipo Committee Chairman Kim Tae-am has been on a hunger strike since the 8th, and whether and how Mipo Committee members will actually participate in the strike will be decided separately.
This strike is scheduled to last 7 hours a day, from 9 a.m. to 5 p.m., excluding lunch. The planned five-day strike will total 35 hours, so if the strike proceeds as planned, a reduction in working hours at the production site is expected.
Ship construction involves several processes, including hull assembly, design, and test operations, so if work is halted for a long time, subsequent processes may also be affected. In particular, as strikes expand at a time when the construction of high value-added ships leads to sales and profits, the burden on production schedule management is increasing.
The union is demanding performance distribution commensurate with performance improvement, saying the company's operating profit is expected to exceed 4 trillion won this year. The company's position is that it has already presented a significant compensation plan and does not have room for additional increases.
After the rejection of the provisional agreement, labor and management renegotiated on the 13th and 15th, but were unable to reach an additional agreement. As the union is increasing the level of pressure through high-altitude sit-ins and partial strikes by all union members, future negotiations are expected to focus on issues such as base pay increases, performance bonus payment standards, and adjustments to working conditions after integration.
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