Attention on final adjustment tomorrow... HMM at crossroads of first-ever strike in history

Union "If Mediation Fails, Legal Struggle First"
Also Demands 'Active Involvement of Creditors'

[Image source=Yonhap News]

[Asia Economy Reporter Yu Je-hoon] Amid a surge in maritime cargo volume due to the novel coronavirus disease (COVID-19) crisis, the national shipping company HMM is facing its first-ever strike brink. As the wage increase gap between labor and management remains unresolved, the industry is closely watching the outcome of tomorrow’s (31st) mediation meeting, which is expected to be a turning point.

According to the shipping industry on the 30th, HMM labor and management will hold a second mediation meeting under the arbitration of the Central Labor Relations Commission on the 31st to discuss next year’s wage and collective bargaining proposals. Currently, the management side has proposed a wage increase in the 1% range, while the union demands an 8% increase, resulting in a deadlock.

The HMM Maritime Federation Labor Union has announced that if the negotiations break down again following the fruitless first mediation meeting on the 23rd, they plan to launch a legal strike starting January 1 next year and intensify dispute actions. They have already prepared for this by conducting a strike vote among union members on the 26th, with 97.3% approval.

The HMM union stated that "a festering wound has burst." For maritime workers at HMM, wages have been frozen for six years, and for land-based workers, for eight years, due to poor management and creditor control. To make matters worse, the COVID-19 crisis that struck this year has led seafarers to work onboard for several months, pushing working conditions to the worst levels. An HMM employee emphasized, "Maritime workers receive the lowest pay in the industry, even lower than Filipino contract workers," adding, "Especially this year, many have taken long-term assignments risking their safety without seeing their families due to COVID-19, leaving everyone in a debilitated state."

The management side is also in a difficult position to easily meet the demands. This year, the sudden increase in cargo volume and supply shortages caused by COVID-19 have led to a turnaround to profitability, with an expected annual surplus of around 800 billion KRW, comparable to a boom period. However, the favorable market conditions cannot last indefinitely. With several trillion KRW of public funds invested under creditor management, public opinion cannot be ignored.

If the strike materializes, significant disruptions to operations are expected. According to Article 25 of the current Seafarers Act, strike actions are restricted when ▲ the ship is in a foreign port or ▲ there is a significant risk to human life or ship safety. In other words, seafarers onboard ships staying in domestic land or calling at domestic ports such as Busan can participate in the strike.

If the union proceeds with a strike by refusing cargo handling or boarding, a logistics crisis is inevitable. Currently, due to the surge in maritime cargo volume caused by COVID-19, HMM is deploying temporary vessels once or twice a month for export companies. An industry insider said, "Even if operations of one or two ships arriving daily at Busan stop, the impact would be considerable," adding, "Due to the nature of the industry, it is difficult to deploy replacement personnel."

However, the HMM union plans to start with low-level actions such as legal strikes, considering the special nature of the logistics industry as a national key industry and the fragile trust relationship with shippers that has barely recovered. Representative measures include complying with seafarers’ rest hours as stipulated by the Maritime Labour Convention (MLC) and requiring workers to undergo COVID-19 testing to ensure seafarers’ safety.

Within the industry, there are calls for KDB Industrial Bank, which leads the creditors, to take a more proactive role. Jeon Jeong-geun, chairman of the HMM union, said, "Due to the nature of the industry, it is not easy to find replacement workers," and added, "While significant investments are made in ships for rebuilding the shipping industry, it is regrettable that the creditors have a shortsighted view of not investing in seafarers." Reporter Yu Je-hoon kalamal@

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