The Tire Industry Intensifies... Concerns Over Prolonged Internal Conflicts

[Asia Economy Reporter Kiho Sung] The tire industry is staggering under a series of adverse events. Hankook Tire & Technology (hereafter Hankook Tire) froze wages this year following the labor union's delegation of negotiation authority, but the second union is opposing this decision. Kumho Tire, which received contract termination notices from six partner companies, has found that no companies applied to replace them. Additionally, other issues such as management disputes and company account seizures are piling up, leaving the situation still chaotic.

According to the industry on the 17th, Hankook Tire decided to freeze wages this year. Instead, reflecting the difficult economic conditions caused by the novel coronavirus disease (COVID-19), they paid an encouragement bonus of 1 million KRW per employee. They also decided not to conduct artificial workforce reductions and agreed to provide year-end incentives if the situation improves.

Previously, the negotiating union, 'Hankook Tire Labor Union (under the Korean Federation of Trade Unions Rubber Industry Union),' delegated this year's wage negotiations to the company and held a delegation ceremony with management on the 23rd of last month. The problem is that the multiple union, 'Hankook Tire Branch (under the Korean Metal Workers' Union of the Korean Confederation of Trade Unions),' is opposing the negotiating union's delegation of wage negotiations.

The negotiating union is conducting member opinion surveys through workplace tours and recently filed a correction request with the Labor Relations Commission for violation of fair representation, among other methods, to voice opposition.

A representative of the multiple unions stated, "This delegation was made in a form where the negotiating union made the decision first and then notified us," adding, "Wages are an issue concerning all employees, but deciding unilaterally by a small executive committee and delegates without consulting the members is not right," and expressed their intention to continue raising objections.

The situation at Kumho Tire is even more serious. Kumho Tire conducted recruitment for subcontractor partner companies until the 11th, but no applications were received. Earlier, on the 31st of last month, six companies responsible for logistics, cargo handling, and raw materials expressed their intention to terminate contracts citing management difficulties such as reduced subcontract volumes. Accordingly, contracts between Kumho Tire and partner companies are valid until the end of this month.

Previously, the Kumho Tire irregular workers' union filed a claim seizure and collection application with the court against the company, resulting in the seizure of the corporate account on the 30th of last month. The union also submitted a report for an outdoor rally related to employment succession to the Gwangju Gwangsan Police Station on the 7th. The location is in front of the main gate of the Gwangju factory, and the period is from the 9th of this month to the 6th of next month.

As conflicts continue, management proposed resolving the issue through a special consultative body for irregular workers and labor, but the union insists that discussions on regular employment conversion should come first. Even scheduling future meetings is proving difficult, raising concerns that the liquidity crisis may be prolonged.

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