Keeping Their Jobs
The labor union of GM Korea with a growing possibility of withdrawing from Korea ahead of the expiration of an agreement between the Korea Development Bank and Global GM in October, called on the Korean government to resolve their employment instability.
The Committee for the Protection of Employment of 300,000 Workers at the GM Korea branch of the KCTU’s Metal Workers Union and lawmaker Hong Young-pyo of the Minjoo Party, made this claim in a press conference at the Jeongron Hall the National Assembly in Yeouido, Seoul on July 12.
"The Korean government should actively engage in the signing of a new agreement with Global GM and GM Korea for a concrete implementation plan that includes prospects for the long-term development of Global GM and GM Korea," the committee said. "The Korean government should not sell the Korea Development Bank (KDB)’s 17.02 percent stake in GM Korea."
Global GM granted the KDB the right to veto GM Korea's board decisions in 2002 for 15 years under an agreement between the KDB and GM Korea shareholders. However, in October 2009, Global GM issued new shares of 421.9 billion won (US$379 million) to be purchased, ridding the KDB of its veto right and giving rise to a “take-money-and-run” controversy.
Afterwards, Global GM and the KDB agreed on an additional agreement in 2010 to enable the KDB to veto a special resolution with its 17.02% stake in GM Korea. The veto right has played a role in preventing GM Korea from withdrawing from Korea, but the agreement will expire this October.
"Recently, Global GM’s sale of Opel Europe Business Division cut down on the volume of exports of cars produced by GM Korea to Europe, further worsening GM Korea’s situation," the committee claimed. “A restructuring and a steady drop in production volume triggered by Global GM's profit structure restructuring strategy is getting closer to stripping workers of GM Korea and its partners and their families of their rights to live.
"On October 16, the agreement between Global GM and the KDB will expire, putting an end to the veto right. Then GM Korea can leave Korea when the KDB sells off its stake. Under these circumstances, the Korean government neither keeps Global GM in check nor has any measures against the automaker,” the committee said.
"If Global GM proposes a sustainable long-term development plan for GM Korea, the labor union will make every effort to reduce costs such as enhancing quality and productivity and slowing down a rise in labor cost. We will do everything we can do to make GM Korea a company that contributes to the creation of jobs and the growth of the national economy."