Application for Labor Dispute Mediation on the 6th
Wage Increase Conflict: 3% vs 0.3%
Employer Side Rejects All Proposals
[Asia Economy Reporter Kim Min-young] Wage and collective bargaining agreement (wage and collective agreement) negotiations between financial labor and management have broken down. The union side holds the employer responsible for the breakdown of negotiations and is considering a strike as a worst-case scenario. As the prolonged COVID-19 pandemic has led to a decline in profitability in the financial sector, there are also voices criticizing the financial union for making excessive demands such as unreasonable wage increases.
According to the financial sector on the 9th, the National Financial Labor Union held a branch representatives meeting and the 3rd Central Committee on the 6th, then applied for labor dispute mediation to the Central Labor Relations Commission. This was a measure following the failure to reach an agreement despite a marathon meeting at the 5th sectoral central negotiation between the Financial Union and the Financial Industry Employers' Council held on the 4th.
The union side does not seem to expect the mediation to be successful. A Financial Union official said, "Since we have not reached an agreement through more than 20 meetings so far, the Central Labor Relations Commission will also fail to mediate," adding, "We are also considering a strike."
The union clearly stated that the employer is responsible for the breakdown of negotiations. The union criticized, "The employer not only failed to show willingness to negotiate but also did not even familiarize themselves with the union's negotiation proposals, consistently showing an insincere negotiation attitude." Park Hong-bae, chairman of the Financial Union, raised his voice, saying, "We tried to achieve exemplary voluntary agreements during the COVID-19 situation, but the negotiations broke down due to the employer's neglect. Despite the difficult situation, the Financial Union will fight to the end through lawful dispute actions." It is known that the employer side holds the position that they cannot accept all proposals, not just wage increases.
The most contentious issue is the wage increase proposal. The union proposed a 3.0% increase, while the employer initially insisted on a freeze and later offered a 0.3% increase. Both sides claimed their proposals took the COVID-19 situation into account and reportedly made no concessions.
The Financial Union also presented 34 demands including ▲ establishment of solidarity wages ▲ gradual extension of retirement age to 65 ▲ gradual establishment of a 35-hour workweek through guaranteed rights to reduce weekly working hours by 5 hours ▲ simultaneous use of lunch breaks by branches ▲ promotion of the establishment of a financial mutual aid association ▲ installation of a joint labor-management committee to prevent workplace harassment at the sectoral level ▲ expansion of maternity protection provisions ▲ establishment of provisions for infectious disease prevention and spread control. The employer side firmly stated that they would not accept any of the remaining proposals, leaving both sides at an impasse.
In particular, the union's proposal to close banks during lunch hours faced strong public criticism. The union suggested operating lunch breaks by grouping three nearby branches. For example, Branch A in Jongno-gu, Seoul, would close from 11 a.m. to 12 p.m., Branch B from 12 p.m. to 1 p.m., and Branch C from 1 p.m. to 2 p.m. Lunch hours for each branch would be announced on the internet and on bulletin boards inside the branches. The employer side expressed reluctance, citing customer convenience in using the bank.
The last strike by the Financial Union was in 2016. Although negotiations broke down and strikes were imminent in 2018 and last year, agreements were reached dramatically.
A financial sector official said, "How many people would accept a 3% wage increase during the COVID economic crisis?" and added, "There are no proposals that the employer side can accept. The union side probably will not go as far as a strike."
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