Ordinary Wage Disputes
There is a growing conflict between unions and management in the auto industry over ordinary wages, despite GM Korea's endeavor to include regular bonuses in the ordinary wage calculation.
According sources in the auto industry on July 21, labor and management of GM Korea will discuss issues including a measure to expand the scope of ordinary wages in the 19th pay negotiation scheduled to be held on July 22. Since the company's summer vacation starts on August 4, labor-management negotiations are expected to mark a watershed in the ongoing ordinary wage disputes.
Previously, management suggested that it will include a fixed bonuses in the scope of ordinary wages as of August 1. The labor union initially welcomed the suggestion, but demanded that the Supreme Court ruling that includes regular bonuses in the definition of ordinary wages issued on December 18 of last year be applied retroactively, starting on January 1, 2014. Like the labor union in the metal industry, workers are calling for a pay raise of 159,614 won (US$155.51). They are also demanding that performance-based bonuses be raised as much as 500 percent of ordinary wages.
Hyundai Motor's labor union is going to demand the expanded scope of ordinary wages on par with GM Korea in its wage negotiations held in the fourth week of July. Previously, they said that they will stage a strike if the company does not accept their demands. The auto maker has an attitude that it will abide by the law, and thus talks between management and workers are likely to continue in the future.
An official at Hyundai Motor remarked, “According to the terms and conditions of employment, one must work more than 15 days for two months to get regular bonuses. So, regular bonuses are not fixed.” The official added, “We will wait for the court's decision on ordinary wages.”
Unionists at Renault Samsung Motors have difficulty in wage negotiations and collective bargaining negotiations, and will therefore go on a partial strike on July 22. After making a decision on July 14 to begin a partial strike, the labor union negotiated with the company, but to no avail. Hence, they will stage a partial strike, starting with local offices.
Workers at Daewoo Shipbuilding & Marine Engineering already demanded that base pay be increased by 87,900 won (US$85.58), and that regular bonuses and fringe benefits be included in the ordinary wage. As for Hyundai Heavy Industries, the possibility that the labor union will stage a strike cannot be ruled out after 19 strike-free years, since workers are playing hardball, asking for an increase in wages and performance-based bonuses, together with the expanded scope of ordinary wages.
As there are visible signs of the labor world's strike, there is growing concern about the issue in business circles. In a statement issued on July 20, the Korea Employers Federation (KEF) stressed, “The labor world is undermining current economic situations by holding meetings and staging labor strikes.” The KEF went on to say, “This kind of behavior paralyzes industrial activities and imposes a big burden for corporations, which will ultimately lead to a crisis situation,” urging the government to take a tougher stance on labor strikes.