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Korean ‘Big 3’ Shipbuilders to Go On Strikes, Followed by STX
Aftermath of Restructuring
Korean ‘Big 3’ Shipbuilders to Go On Strikes, Followed by STX
  • By Jung Min-hee
  • June 20, 2016, 10:00
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Conflicts between the managements and labor unions of the ‘Big Three’ shipbuilders are on the rise while those of mid-size shipbuilders are in a harmony mood.
Conflicts between the managements and labor unions of the ‘Big Three’ shipbuilders are on the rise while those of mid-size shipbuilders are in a harmony mood.

 

Conflicts between the managements and labor unions of the ‘Big Three’ shipbuilders are on the rise. The local shipbuilders so called “Big Three” -- Hyundai Heavy Industries, Daewoo Shipbuilding & Marine Engineering, and Samsung Heavy Industries -- are now all in the preliminary procedures for strike. STX Offshore & Shipbuilding, which had already gone under legal management, also decided to go on strike. The aftermaths of the industry restructuring seem to escalate the labor disputes into the full-scale starting from July. According to the shipbuilding industry on June 20, STX Offshore & Shipbuilding, which is under legal management, decided to go on strike on June 19 with gaining 55%votes of labor union members.

On June 17, Hyundai Heavy Industries held a temporary meeting of representatives todecide on a dispute occurrence. The labor union is expected to submit the application for labor dispute mediation to the Central Labor Relations Committee within today. Samsung Heavy Industries workers’ council, on the other hand, is adjusting the date for the vote, after deciding to go on strike on 15. Daewoo Shipbuilding & Marine union also conducted a strike vote last week, passing it with a high rate of 85% being in favor of the strike.

The labor unions are justifying the strikes by ascribing them to the harsh restructuring of their companies. Over 2000 workers of Hyundai Heavy Industries have made voluntary resignation, and the spin-off of its facility business unit is also in the process. The unstable employment of the workers being spread out along with the spin-off process is also increasing the level of union opposition. Daewoo Shipbuilding & Marine is planning to reduce 3,000 employees by 2019, and Samsung Heavy Industries also announced they will reduce their employees by 30% to 40%. Earlier, STX Offshore & Shipbuilding had announced the plan to reduce the employees by 30% at the end of last year.

Voices are coming in the industry that the strike should be avoided even in the worst case. Nevertheless, there is no way to iron out an arbitration to the labor disputes. “We can understand such tough reactions of the labor unions to the employment reduction,” an industry insider said, adding, “But the strike could result in an irreversible situation where the creditors stop the various supports needed for their survival. 

In contrast, labor unions of mid-sized shipbuilding companies like Hanjin Heavy Industries & Construction, Sungdong Shipbuilding & Marine, and Dae Sun Shipbuilding & Engineering, are in a “harmony mode.” In particular, the union of Hanjin Heavy Industries entrusted the management with the authority to deal the wage and the collective bargaining. The entrustment took place first in 80 years since the foundation of the company in 1937.