Hyundai Motor, Hyundai Heavy Industries, Korea GM, and Others Expected to Elect Strong Labor Unions
Labor-Management Conflicts Likely to Intensify Next Year
[Asia Economy Reporter Changhwan Lee] Strong labor unions are gaining influence in key domestic industries such as automobiles and shipbuilding. Following the election of a hardline faction as the next executive team at Hyundai Heavy Industries, the automobile industry, including Hyundai Motor Company and Korea GM, which are currently holding elections for their next union executive teams, is showing a similar atmosphere.
As the economic crisis caused by COVID-19 continues, signs of intensified labor-management conflicts are emerging, making the business outlook for companies next year even more uncertain.
Hyundai Motor, Hyundai Heavy, and Others Near Election of Hardline Unions
According to the Hyundai Motor union on the 3rd, the final candidates for the Hyundai Motor union branch chief runoff election scheduled for the 7th are An Hyun-ho and Kwon Oh-il.
The two final candidates are considered more hardline compared to the previous union branch chief. Candidate An is affiliated with the 'Metal Solidarity' and served as the senior vice chairman. He led the opposition to Hyundai Motor's layoffs in 1998. In this election, he has pledged to apply the full bonus as ordinary wages, improve treatment for general and female union members, and prepare employment measures for the Fourth Industrial Revolution, signaling potential conflicts with the company.
Candidate Kwon belongs to the 'Democratic On-site Struggle Committee' and previously served as the head of external cooperation, actively supporting struggles for irregular workers. His campaign promises include flexible working hours, institutionalizing performance bonuses, securing key electric vehicle parts production in-house, and reducing working hours.
On the other hand, Lee Sang-soo, the current union branch chief who led three consecutive years of dispute-free wage and labor negotiations, ran as candidate number 1 but lost in the vote to other candidates. Lee is classified as having a moderate and pragmatic stance compared to the other candidates.
Korea GM and Kia are also expected to elect their next union branch chiefs within this month. In the preliminary vote held on the 30th of last month, Korea GM's candidates number 1 Kim Jun-oh and number 4 Kim Ki advanced to the runoff. Korea GM has been experiencing prolonged labor-management conflicts amid rumors of General Motors (GM) withdrawing its domestic production plants.
Kia, currently governed by a hardline union executive team, plans to finalize candidates on the 6th and conduct elections until the end of the year. The next union is also expected to lean toward a hardline stance.
The next executive team at Hyundai Heavy Industries will also be formed with a hardline tendency. The Hyundai Heavy Industries union announced that in the recent election for the new branch chief, among 8,508 total union members, candidate Jeong Byeong-cheon was elected with 4,082 votes (52.68%). The newly appointed branch chief Jeong comes from the existing hardline executive organization.
Outlook for Intensified Conflicts... Uncertain Business Outlook
With key companies’ new union chiefs being hardline, the possibility of intensified labor-management relations next year has increased. Even this year, labor disputes have increased compared to last year due to general strikes by the Korean Confederation of Trade Unions, and there are concerns that the situation may worsen next year.
According to the Ministry of Employment and Labor, the number of domestic labor disputes from the beginning of this year until September totaled 87 cases, a 52.6% increase compared to 57 cases during the same period last year. Labor conflicts, which had decreased due to COVID-19 last year, are on the rise again.
However, with the recent sharp increase in COVID-19 cases and strengthened social distancing measures, the situation for companies is worsening, and the increasing labor conflicts are expected to place a significant burden on Korean corporate management.
Kim Cheol-hee, head of the Labor-Management Relations Support Team at the Korea Employers Federation, pointed out, "The election results of the new executive teams at the Hyundai Motor and Hyundai Heavy Industries branches of the Korean Metal Workers' Union, affiliated with the Korean Confederation of Trade Unions, show a choice of a hardline struggle route, abandoning moderate pragmatism." He added, "There is a very high possibility that labor-management relations in Korea will be driven into an extremely tense state for the next two to three years."
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