Hyundai Steel Overcomes Strike Threat but Faces Burden of Direct Employment for Non-Regular Workers

Hyundai Steel has fallen into difficulties due to ongoing union risks. After overcoming the strike crisis, it now faces the burden of directly employing non-regular workers.

According to the industry on the 14th, the Supreme Court on the 12th ruled that 161 non-regular workers at Hyundai Steel's Suncheon plant are regular workers in a labor status confirmation lawsuit. They filed the lawsuit against Hyundai Steel (then Hyundai Hysco) in July 2011 and concluded the lawsuit after 12 years and 8 months.

[Image source=Yonhap News]

The steel industry is somewhat expecting this ruling. Since the non-regular workers had won all previous first and second trials, it was predicted that the Supreme Court's judgment would not differ significantly.

The Hyundai Steel Non-Regular Workers Branch of the Korean Metal Workers' Union Gwangjeon Branch welcomed the Supreme Court's ruling on illegal dispatch in the steel industry and stated, "Hyundai Steel should apologize for the illegal dispatch labor and unfair labor practices during the period and immediately convert all Hyundai Steel non-regular workers to regular workers following the Supreme Court ruling." A Hyundai Steel official said, "We respect the court's ruling and plan to faithfully implement follow-up measures according to the judgment."

The problem is that collective lawsuits by non-regular workers are still ongoing. The burden of future lawsuits is expected to increase further due to this Supreme Court ruling. The 2nd and 3rd collective lawsuits (258 people) for confirmation of non-regular worker status won at the Gwangju District Court Suncheon Branch on July 21, 2022, and the second trial is ongoing at the Gwangju High Court. The 4th and 5th lawsuits (75 people) have been in the first trial at the Gwangju District Court Suncheon Branch since December 2020.

Hyundai Steel recently narrowly avoided a strike crisis related to wage increases. The Korean Metal Workers' Union Hyundai Steel Branch postponed a planned 48-hour strike on the 13th. Although the plant is operating normally, conflicts are expected to continue as both sides have differing positions.

In this year's wage negotiations, the union demands from management include ▲a base salary increase of 184,900 KRW (excluding seniority increments) ▲a special performance bonus of 25% of the previous year's (2022) operating profit ▲various allowance increases ▲expansion of summer vacation and calculated holidays. The company proposed ▲a base salary increase of 103,000 KRW (including seniority increments) ▲a 400% performance bonus ▲a 13.3 million KRW encouragement bonus but failed to reach an agreement.

The company states that it is difficult to accept the union's proposals due to declining profitability amid the steel industry's downturn. Seo Gang-hyun, CEO of Hyundai Steel, held meetings last month with the heads of five Korean Metal Workers' Union Hyundai Steel branches (Dangjin, Incheon, Pohang, Suncheon, Dangjin Hysco) to negotiate but could not narrow the differences.