Kia Also Achieves No-Strike Labor Agreement, Overcoming Strike Crisis in the Complete Vehicle Industry

Kia Autoland Gwangmyeong
[Image source=Yonhap News]

[Asia Economy Reporter Changhwan Lee] Kia has significantly reduced the risk of strikes in the domestic automobile manufacturing industry this year by concluding wage negotiations without disputes. Previously, Hyundai Motor and Korea GM (GM) completed their wage and collective bargaining negotiations, and currently only Renault Samsung Motors is still in the process.

According to industry sources on the 28th, the Kia labor union passed the tentative agreement on wage negotiations with a 68.2% approval rate in a member vote held the previous day.

The tentative agreement includes a base salary increase of 75,000 KRW (including regular seniority increments), a performance bonus of 200% plus 3.5 million KRW, a special quality improvement incentive of 2.3 million KRW, traditional market gift certificates worth 100,000 KRW, and the issuance of 13 shares of stock.

Additionally, labor and management signed a ‘Labor-Management Win-Win Agreement for Responding to Future Industrial Changes’ to address the restructuring of the 4th industrial revolution, and agreed to improve employee welfare such as discounts on first car purchases and support for student loan interest payments.

The signing ceremony is scheduled to take place at 2 p.m. on the 30th at Autoland in Soha-ri, Gwangmyeong City, Gyeonggi Province.

Last year, Kia experienced difficulties including a four-week partial strike, but this year, like Hyundai Motor, it concluded wage negotiations without disputes. This is the first time in 10 years that Kia has completed wage negotiations without a strike.

Hyundai Motor was the first among the four domestic automakers to complete wage and collective bargaining negotiations. After the initial meeting in May, Hyundai Motor concluded negotiations in about 60 days, reaching an agreement before the summer vacation for the first time in three years since 2018.

The labor-management agreement includes a base salary increase of 75,000 KRW (including seniority increments), a performance bonus of 200% plus 3.5 million KRW, a quality improvement and accident prevention incentive of 2.3 million KRW, and the issuance of 5 shares of stock as a special agreement to secure future competitiveness.

Korea GM also held a total of 15 negotiation sessions starting with the initial meeting in May, and on the 19th, reached a second tentative agreement that included a monthly base salary increase of 30,000 KRW, a lump sum payment of 4.5 million KRW, and additional benefits such as vehicle maintenance coupons worth about 300,000 KRW for its own brand vehicles and traditional market gift certificates worth 200,000 KRW.

The first tentative agreement was rejected with 51.15% opposition, but the Korea GM labor union engaged in additional negotiations with management without striking, and after 23 days from the rejection, produced the second tentative agreement.

The situation at Renault Samsung Motors remains difficult. On the 25th, labor and management held wage and collective bargaining negotiations but failed to reach a tentative agreement due to disagreements over the amount of compensation for the two-year base salary freeze.

The management proposed a lump sum payment totaling 8 million KRW, including 2 million KRW compensation for the 2020 and 2021 base salary freeze and an average productivity incentive of 2 million KRW per person, but the union is demanding a base salary increase of 71,687 KRW and an incentive payment of 7 million KRW. Labor and management will hold additional negotiations early next week.

Meanwhile, Ssangyong Motor, which is undergoing a sale process, has maintained a no-dispute status for 12 consecutive years.

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