Collective Action Spreads Over Purmil Incident... Company Says "Will Accept Voluntary Retirement"

Purmil Crisis Spreads Across the Board
Dairy Farmers and Union Continue Protests in Front of Headquarters
Truck Drivers and Dealership Owners Also Take Collective Action
Purmil "Accepting Voluntary Retirement Applications"

[Asia Economy Reporter Song Seung-yoon] The aftermath of Purmil's business closure is intensifying. Following dairy farmers and labor unions, freight drivers responsible for transporting Purmil products and dealership owners have also launched collective protests.

According to industry sources on the 29th, after Purmil announced its business closure, the Purmil Dealership Owners Association was formed, mainly consisting of dealership owners in the Gyeongnam region. They plan to decide on collective action after hearing the company's position following the second round of negotiations scheduled for the 31st. Freight drivers who transported Purmil products have also decided to stage a collective protest soon.

Protests continue daily in front of Purmil headquarters. On the 26th, the Purmil labor union held a rally with about 100 participants, urging, "Even now, please open a path for workers to take over through a public sale process." A day earlier, on the 25th, farmers demanding the right to survive as dairy producers held a rally. They have supplied raw milk to Purmil for over 40 years since 1979 but will lose their supply destination overnight due to the business closure.

The impact of Purmil's business closure is growing. Approximately 360 Purmil employees who received layoff notices, 50 employees from partner companies, about 150 delivery drivers, and over 500 dealership owners and employees, as well as dairy farmers, totaling more than 1,000 people, are directly affected.

On the 26th, the Purmil labor union held a rally in front of the company's headquarters in Yeongdeungpo-gu, Seoul, protesting the company's unilateral business closure and dismissal notice. The photo shows the Purmil headquarters on that day. Photo by Hyunmin Kim kimhyun81@

Purmil sparked controversy by suddenly deciding to accept voluntary retirement applications while still negotiating with the labor union. Shin Dong-hwan, CEO of Purmil, announced the recruitment of voluntary retirement applicants the day before, stating that applications would be accepted from all general and technical staff until the 9th of next month. The offer included severance pay, two months' worth of consolation pay combining regular wages and bonuses, and payment for unused annual leave.

Earlier, Purmil decided to cease operations on the 30th of next month and sent emails notifying all 400 employees of the business closure and layoffs on the 17th. The company cited continuous deficits over several years, a sharp decline in sales due to the COVID-19 pandemic, and an inability to find a solution to the accumulated losses as reasons. LG Household & Health Care had previously attempted to acquire Purmil but ultimately failed. Retailers that had contracts to supply Purmil's private brand (PB) products are also seeking alternative suppliers.

Purmil's website was inaccessible for a while after the business closure notice on the 17th but has since returned to normal. Purmil is a dairy processing specialist known for products such as ‘Bifidus,’ ‘Milk with Black Beans,’ and ‘Banana Kick Milk.’ It was spun off from Lotte Dairy under the Lotte Group in April 2007 and renamed Purmil in 2009. Since last year, the company has been solely operated by CEO Shin Dong-hwan, the second son of Chairman Shin.

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