Hyundai Motor, Four Consecutive Years of Strike-Free Labor Negotiations... "Starting a Labor-Management Relationship to Jointly Ensure Future Survival"

Provisional Agreement Reached
Basic Salary Increased by 4.3%

Hyundai Motor Company Ulsan Plant Myeongchon Main Gate

[Asia Economy Reporter Choi Dae-yeol] The Hyundai Motor Company labor and management are highly likely to conclude wage negotiations without strikes for the fourth consecutive year. If approved in the upcoming union member vote scheduled for next week, the negotiations will conclude in just over two months. Both labor and management stepped back amid a sense of crisis that the company's future would be uncertain if they failed to respond timely during the automotive industry's transition period, thus finishing the negotiations without exhausting conflicts.

According to the company and the union on the 13th, Hyundai Motor labor and management reached a tentative agreement at the 15th wage negotiation held the previous day. Hyundai Motor CEO Lee Dong-seok said, "I hope this year's negotiations become a turning point for a new labor-management relationship," adding, "Rather than repeatedly misunderstanding and clashing due to different assessments of the objective business situation, we want to create the beginning of a labor-management relationship that can jointly pursue the company's future survival and development."

The tentatively agreed basic salary increase and performance bonus are at record-high levels. Specifically, a 4.3% increase in the monthly basic salary (108,000 KRW per month, including step increases and allowances), a performance bonus of 200% + 4 million KRW, a quality improvement incentive of 1.5 million KRW, and a second-half target achievement incentive of 100%, among others. The union stated in the union member newsletter released that day, "Considering the basic salary and allowances, we have achieved the largest wage increase in history."

If approved in the union member vote scheduled for the 19th, the negotiations will conclude 71 days after they began. Since the 2019 wage and collective bargaining negotiations, which were resolved without disputes despite unexpected variables such as Japan's export restrictions, this marks the fourth consecutive year. It is the first time since the company's establishment.

In 2020, wages were frozen due to COVID-19, and negotiations concluded in just one and a half months, while last year took about two months. The industry had widely expected that the no-strike record would be broken, as the current union leadership is considered 'hardline' and had secured the right to strike. Nevertheless, with the confirmation of major agendas such as wage increases, large-scale domestic investment plans, new hiring, and wage system reforms, the negotiations entered the final stages earlier than initially expected.

Hyundai Motor Ulsan Plant Ioniq 5 Production Line

It is interpreted that both labor and management agreed that they could no longer delay in accelerating the transition to electrification, a global automotive industry focus, and enhancing software competitiveness such as autonomous driving. Hyundai Motor had earlier decided to build an electric vehicle factory in the United States, and its affiliate Kia also decided to operate a new factory dedicated to electric vehicles in Hwaseong.

As Hyundai Motor, which has the largest union in a single workplace in Korea, passes this year's negotiations without a strike, attention is focused on whether this will influence its affiliates and other workplaces.

A company official said, "Despite internal and external risks such as the prolonged semiconductor supply crisis, global economic recession, and the Russia-Ukraine war, labor and management discussed future vision and employment stability with a sense of urgency," adding, "Even amid the automotive industry's transition and global management environment uncertainties, we will pool our capabilities so that domestic workplaces can solidify their role and status as global hubs and leap forward as 'first movers' in the future mobility era."

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