Labor disputes in major steel and shipbuilding companies, including POSCO, HD Hyundai Heavy Industries, and Hanwha Ocean, will resume after the Chuseok holidays. These unions are seeking wage increases and performance bonuses at a time when companies are facing rising profits and a backlog of orders.
Renewal of Negotiations at POSCO
POSCO will resume wage negotiations after the election of a new union leadership on October 2. The company experienced its first strike since its establishment earlier this month, with a partial 48-hour strike followed by a partial 120-hour strike that ended on September 21.
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The two sides disagree on the size and structure of the wage package. The union is demanding a 7.1 percent increase in the base wage, bonuses equivalent to 600 percent of the base wage, 50 shares in the employee stock ownership plan, and a 200 percent holiday bonus. On the other hand, POSCO has only proposed a 2 percent increase in the base wage and a bonus of 3.5 million won ($2,600).
Situation in the Shipbuilding Industry
In the shipbuilding industry, HD Hyundai Heavy Industries and Hanwha Ocean are also expected to resume their negotiations on Tuesday. The HD Hyundai Heavy Industries union announced on September 18 that this year's wage negotiations had reached a deadlock after 21 rounds of talks since June.
This union is demanding an increase of 149,600 won in the base wage, a 100 percent increase in bonuses, and 30 percent of operating profits. Meanwhile, the company has only proposed an increase of 110,000 won (including a 47,000 won increase in seniority) and incentive payments equivalent to 200 percent along with 10 million won and 500,000 won in shopping vouchers.
Hanwha Ocean is also involved in a similar dispute regarding wages and performance bonuses. The union of this company has been holding partial and full strikes since late August, halting operations of all four Goliath cranes at its shipyard in Geoje, South Gyeongsang Province for 24 hours on September 18.
This union is demanding an increase of 149,600 won in the base wage, higher bonuses, an increase in the retirement age, and greater transparency in the performance pay system. Management has responded with a proposal to increase by 100,000 won and a one-time payment of 6.5 million won and 1 million won per year for employee benefits.
As a positive note, Samsung Heavy Industries signed a temporary agreement before the holidays, becoming the first of the three major shipbuilders to conclude its wage negotiations this year.
