Financial Labor Union Considers Strike Following Breakdown of Wage and Collective Bargaining Agreement Negotiations

Application for Labor Dispute Mediation on the 6th
Wage Increase Conflict: 3% vs 0.3%

[Asia Economy Reporter Kim Min-young] Wage and collective bargaining agreement (CBA) negotiations between financial labor and management have broken down. The union side holds the employer responsible for the failure of negotiations and is considering a strike as a worst-case scenario. Amid the prolonged COVID-19 pandemic and the resulting deterioration in profitability in the financial sector, there are also voices criticizing the financial union for making excessive demands such as unreasonable wage increases.

According to the financial sector on the 9th, the National Financial Labor Union held a branch representatives meeting and the 3rd Central Committee on the 6th, then applied for labor dispute mediation to the Central Labor Relations Commission. This was a response to the failure to reach an agreement despite marathon talks during the 5th sectoral central negotiations between the financial union and the Financial Industry Employers’ Council held on the 4th.

The union side does not seem to expect the mediation to be successful. A financial union official said, “Since we have failed to reach an agreement after more than 20 meetings, the Central Labor Relations Commission will also fail to mediate,” adding, “We are also considering a strike.”

The union clearly stated that the employer is responsible for the breakdown of negotiations. The union criticized, “The employer not only failed to show willingness to negotiate but also did not even familiarize themselves with the union’s negotiation proposals, consistently demonstrating an insincere negotiation attitude.” Park Hong-bae, chairman of the financial union, said, “We tried to achieve exemplary voluntary agreements during the COVID-19 situation, but the employer’s neglect of negotiations led to the breakdown,” and raised his voice, “Although the situation is difficult, the financial union will fight to the end through lawful industrial actions.” The employer side is reportedly taking the position that it cannot accept not only wage increases but all proposals.

The most contentious issue is the wage increase proposal. The union proposed a 3.0% increase, while the employer initially insisted on a freeze but later offered a 0.3% increase. Both sides claimed their proposals took the COVID-19 situation into account and reportedly made no concessions.

The financial union also presented 34 demands including ▲ establishment of solidarity wages ▲ gradual extension of retirement age to 65 ▲ gradual establishment of a 35-hour workweek by guaranteeing the right to reduce working hours by 5 hours per week ▲ simultaneous use of lunch breaks across branches ▲ promotion of the establishment of a financial mutual aid association ▲ installation of a joint labor-management committee to prevent workplace harassment at the sectoral level ▲ expansion of maternity protection provisions ▲ introduction of provisions for infectious disease prevention and spread control. The employer side firmly rejected all other demands, leading to a deadlock between the two sides.

In particular, the union’s proposal to close bank branches during lunch hours faced strong public criticism. The union suggested operating lunch breaks by grouping three nearby branches. For example, Branch A in Jongno-gu, Seoul, would close from 11 a.m. to 12 p.m., Branch B from 12 p.m. to 1 p.m., and Branch C from 1 p.m. to 2 p.m. Lunch break times for each branch would be announced online and on in-branch bulletin boards. The employer expressed reluctance, citing customer convenience in using the bank.

The last strike by the financial union was in 2016. Although negotiations broke down and strikes were imminent in 2018 and last year, agreements were reached dramatically.

This content was produced with the assistance of AI translation services.