Hyundai Heavy wage negotiations falter as union votes against tentative agreement
Dissatisfaction with the lower-than-expected basic salary increase leads to the rejection of the resolution in the vote
The union isn’t planning any further strikes, but changes in management and union representatives involved in the negotiations may delay the conclusion of the talks
THE tentative agreement reached between management and the union at South Korea’s HD Hyundai Heavy Industries during the 30th round of wage talks has failed to pass in a union ballot.
Although wage and bargaining negotiations resumed after the vote to seek a second tentative agreement, it remains uncertain whether a deal will be concluded before the end of the year. This uncertainty is compounded by the potential changes in the negotiation team, as new members could be elected.
The HD HHI union announced that out of 6,130 voters, 3,658 (59.67%) voted against the proposal. Only 39.46% supported the agreement, indicating insufficient backing from union members.
“Boosting the morale of the members is what is needed in the shipbuilding boom,” said union leader Ho-sun Paik. “A majority rejection is a warning to management. The renegotiations should produce a proposal that reflects the wishes of the members.”
The primary reason for the rejection was the proposed basic wage increase of Won129,000 ($92) and a bonus of Won4.5m, which fell short of the union’s initial demand for a Won159,800 wage increase, citing the current shipbuilding boom.
Negotiations have resumed, but if they are not concluded by the year-end, talks could extend into next year. There is precedent for delayed negotiations, as the company’s 2021 talks were only approved in 2022.
A union official told Lloyd’s List, “With the election of union representatives next month and likely changes in company executives before the end of the year, these factors could delay the conclusion of negotiations.”
Despite the setbacks, the union has no plans for further walkouts, which have occurred 24 times since August before the first tentative agreement was reached.
SK Securities analyst Seung-han Han told Lloyd’ List, “During the partial strikes, the company increased its outsourcing of work. Therefore, production was not delayed.”
When contacted by Lloyd’s List, HD HHI declined to comment. After the first tentative agreement was reached, the company had expressed a desire to conclude negotiations by the end of the year.
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