Despite Worsening Sales amid COVID-19 Crisis
Even though Renault Samsung Motors’ sales have been worsening, its labor union has renewed its attack on the management for delaying collective bargain and wage negotiations and moving to sell direct service centers. The labor union is turning a deaf ear to reports of labor-management cooperation at other Korean automakers and foreign automakers in the aftermath of the COVID-19 crisis.
Renault Samsung's labor union said in its newsletter on June 23, "We will hold an informal rally to demand that the management withdraw its decisions to delay the 2020 wage and collective bargaining negotiations and cut the number of direct service centers." The move came five months after the union held an informal rally in January 2020 to put pressure on the management during the wage negotiations for 2019.
The labor union criticized the management for unilaterally postponing the schedule for wage and collective bargaining twice and trying to sell off its direct service centers. "When the labor and the management struck an agreement on wage and collective bargaining talks for 2019, we agreed to start the bargaining for 2020 on June 1, 2020, but the management put if off to July again unilaterally after delaying it to June 15," the labor union said. "We cannot tolerate continued employment instability caused by the reduction of direct service centers. There will be no cooperation with the management from now on."
Renault Samsung says it is the labor union's unilateral claim. As the company started emergency management, the management proposed to share each other's plans unofficially for smooth talks between the labor and management, even if the kickoff of wage and collective bargaining was postponed to July, but the union reportedly refused the proposal. In addition, the reduction of direct service centers is in its early internal review stage, but the union is making it a fait accompli and using it as a means to fuel union members' anxiety, the management say.
Some suspect that the union may have its own hidden agenda. Analysts say the union has started attacking the management to show its colors ahead of the next labor union election. The current leadership was elected in November 2018, and the union is set to hold an election in November when their two-year term comes to an end. The current leadership was elected with 51.5 percent of the votes with a pledge to switch its affiliation to the Korean Metalworkers Union.
Since the inauguration of the current leadership, Renault Samsung`s labor union has been colliding with the management in wage and collective bargaining by making demands for higher wages, ignoring the management’s business situations. The current labor union leadership also caused concerns over labor-labor conflicts. In early 2020, when union leaders pushed for joining the Korean Confederation of Trade Unions and an unreasonable strike to raise wages, they faced resistance from union members.
The union leaders are losing support from union members due to repeated mistakes. Analysts say that the union's excessive demands regarding wage and collective bargaining and attempts to fuel anxiety over employment security are strategies to win the next labor union election rather than to ensure the rights and interests of union members.
Renault Samsung has been suffering from the worst financial difficulties in the past decade as the growing impact of the novel coronavirus crisis. Renault Samsung which posted a surplus in 2019 reportedly swung to a deficit in the first quarter of 2020. The carmaker sold 177,450 units in 2019, down 22 percent from a year earlier. In the first five months of 2020, cumulative sales fell 20.5 percent on year to 53,406 units. The drop in entrusted production of the Nissan Rogue was attributable to a nearly 70 percent plunge in exports during the same period.