Ssangyong C&E Union Declares Wage Freeze to Overcome Management Crisis

In July, Hyunjoon Lee, president of Ssangyong C&E (left), and Donghwan Choi, chairman of the labor union, posed for a commemorative photo after announcing a joint declaration to participate in overcoming the crisis following the launch of an emergency management system.
[Photo by Ssangyong C&E]

[Asia Economy, reporter Kim Jonghwa] The labor union of Ssangyong C&E has decided to freeze wages this year in order to participate in overcoming the crisis triggered by changes in internal and external business conditions.

On November 22, at the Ssangyong C&E headquarters in Jeodong, Jung-gu, Seoul, the Ssangyong C&E labor union held an extraordinary labor-management council meeting attended by company and union representatives, including President Hyunjoon Lee and union chairman Donghwan Choi, and announced a wage freeze for this year. This declaration comes seven months after the union delegated this year’s wage negotiations to the company in April, and it is unusual in that the union has reversed its previous position and agreed to freeze wages.

The background to the wage freeze by the Ssangyong C&E labor union is the deterioration of business conditions. Despite price increases and higher sales volumes earlier this year, Ssangyong C&E has faced significant challenges due to a sharp rise in manufacturing costs caused by higher coal prices and electricity rates, as well as increased logistics costs, and surges in exchange rates and interest rates. In order to overcome this complex crisis, the company implemented an emergency management system at the end of July, and the labor union also issued a joint declaration to overcome the management crisis, mobilizing all efforts in response.

However, as the war in Ukraine has dragged on, prices of key raw materials have remained high, and uncertainty has further increased due to the quadruple challenges of high inflation, high exchange rates, high interest rates, and high oil prices, which have been triggered by the expansion of economic stimulus policies in various countries. As a result, the company has continued to face management difficulties. In fact, by the third quarter of this year, Ssangyong C&E's operating results showed an increase in sales compared to the same period last year, but operating profit and net income decreased by 50.9% and 73.2%, respectively.

Union chairman Donghwan Choi stated, "The decision to delegate wage negotiations to the company earlier this year was made by the union for the greater good and for the company's development," and emphasized, "This wage freeze expresses the union’s full understanding of the company’s current difficult business conditions, and our strong commitment to actively participate in overcoming the management crisis, in line with the fundamental labor-management philosophy of Ssangyong C&E, which is the principle of unity between labor and management."

President Hyunjoon Lee also said, "I am grateful to the labor union for agreeing to freeze wages this year in order to jointly overcome the management crisis, given the difficult business environment. At the same time, I feel a heavy sense of responsibility," adding, "We will do our utmost to overcome the current crisis and return management to a normal track as quickly as possible."

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