Renault Samsung Motors will file a damage suit against the labor union leadership, claiming that its daily losses from an illegal strike amount to more than 10 billion won.
Renault Samsung recently took action to hold labor union leaders responsible for causing astronomical losses to the company through the illegal strike, sources of the automobile industry and the legal world said on June 11. The management will initiate a partial closure of plant operation at night.
The management of Renault Samsung has decided to bring an action against the union leaders as it believes a full strike order they issued on May 5 was a violation of the labor union law.
Article 44 (1) of the current Trade Union Act stipulates that a company does not need to pay wages for workers who do not work during a strike period. The following clause says that the labor union must not demand wages from the management during the strike. The Renault Samsung union, however, demanded, in violation of the law, that the company pay compensation on top of the 17 million won agreed upon in an interim wage agreement. The company said that it considered the demand illegal and would file the suit against the labor union leadership, claiming 14 billion won a day in damages. The figure represents 80 percent of the daily production losses caused by the strike.
In addition, Renault Samsung announced a partial closure of the plant which will halt the operation at night beginning on June 12.
Workers can produce 460 vehicles during eight working hours minus 10-minute breaks in the morning and the afternoon at the Busan plant of Renault Samsung. However, output in the first and second regular working days (June 7 and 10) after the full strike was a mere 41 units and 60 units, respectively. They are 10 percent to 20 percent of normal daily production. However, the management did not confirm specific details about how long the partial closure will last.
The amount of Nissan Rogue production entrusted to Renault Samsung’s Busan plant shrank from 100,000 units to 60,000 units. The volume is expected to continue to decline as the contract with Renault Group of France will come to an end in September. The automaker’s sales fell more than 30 percent during the January-May period of this year.
The conflict between the labor and management of Renault Samsung is deteriorating day by day. The two sides have failed to iron out differences in labor negotiations since June last year. During this period, the union put pressure on the management by going on partial and full strike. This time the management did not falter and decided to take a stern measure to start a partial closure of the plant.