Labor Negotiation Stalemate... HD Hyundai Heavy Union Proposes Three Weekly Negotiations to Management to Secure 'Right to Strike'

Domestic shipbuilders have been struggling with wage and collective bargaining negotiations for two months, and the negotiations scheduled immediately after the collective summer vacation are expected to be a turning point for a general strike.

According to the industry on the 2nd, the labor and management of HD Hyundai Heavy Industries plan to hold their 17th negotiation on Monday the 13th, the first Monday after the summer vacation ends on the 8th. The union plans to propose to the management to increase negotiations from twice a week to three times a week. Depending on the negotiation atmosphere at this meeting, the decision to proceed with a strike may be made.

On June 4th, at the Ulsan headquarters, Lee Sang-gyun, President of HD Hyundai Heavy Industries, Kim Byung-jo, Vice Chairman of the Metal Workers' Union, and Baek Ho-seon, Branch Chief of the Metal Workers' Union HD Hyundai Heavy Industries Branch, along with labor and management of HD Hyundai Heavy Industries, held the '2024 Wage and Collective Agreement Negotiation Meeting' to discuss the negotiation schedule and other matters.
[Photo provided by HD Hyundai]

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The company and the union have conducted 16 rounds of practical and main negotiations since the initial meeting for wage and collective bargaining on June 4th, but no significant progress was made before the vacation started on the 29th of last month. Hanwha Ocean and Samsung Heavy Industries are also in the process of wage and collective bargaining, but the situation remains stagnant.

The HD Hyundai Heavy Industries union secured the right to strike on the 29th of last month. In the strike vote, 65.1% of all union members voted in favor, and they also received a 'mediation suspension' decision from the Central Labor Relations Commission. The mediation suspension decision is issued by the commission when the gap between labor and management positions in collective bargaining cannot be narrowed.

The HD Hyundai Heavy Industries union submitted a total of 61 demands to management, including a basic wage increase of 159,800 KRW, a seniority allowance of 10,000 KRW per year, extension of retirement age to 65 (abolition of the wage peak system), new hires, changes to the performance bonus calculation criteria, and legal amendments. The company requested the union to reorganize and resubmit the demands due to their volume, while the union maintains that it will judge after reviewing the company's proposals.

A representative of the Korean Metal Workers' Union said, "Among the eight shipbuilding workplaces belonging to the Metal Union, including HD Hyundai Heavy Industries, none reached an agreement on wage and collective bargaining before the summer vacation," adding, "They have decided on a joint strike on the 28th of this month to enforce negotiations before the Chuseok holiday." The Shipbuilding Industry Union Coalition recently announced that 72.5% (13,864 members) of the total union members voted in favor in the strike vote conducted until the 24th of last month. Of the 19,111 total members of the coalition, 14,936 (78.15%) participated in the vote, with only 1,042 opposing.

The Shipbuilding Industry Union Coalition includes HD Hyundai Heavy Industries, HD Hyundai Mipo, HD Hyundai Samho, Hanwha Ocean, Samsung Heavy Industries, K Shipbuilding, HJ Heavy Industries, and HSG Sungdong Shipbuilding.

The HD Hyundai Heavy Industries Labor Union counting the votes of the strike referendum held for union members due to difficulties in this year's wage and collective bargaining negotiations at the Ulsan headquarters on the 24th of last month.
Photo by HD Hyundai Heavy Industries Labor Union

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The HD Hyundai Heavy Industries union argues that the management's claim of lacking financial capacity is unconvincing, given that the industry is experiencing a boom for the first time in 10 years and has secured orders exceeding four years' worth. Subcontracted workers are not even receiving minimum wage, and there are complaints that the wage levels are unrealistic compared to the work intensity. Resolving the dual structure of the labor market is also one of President Yoon Suk-yeol's major reform tasks.

A Metal Union official said, "Samsung Heavy Industries is telling Hanwha Ocean to raise wages first, and Hanwha Ocean is asking HD Hyundai Heavy Industries to raise wages quickly to set the industry standard," adding, "It looks like the executives are playing a game of watching each other to see who will raise wages first."

An HD Hyundai Heavy Industries official expressed regret over the preparation for a strike at a time when the shipbuilding market is recovering and only about ten rounds of negotiations have been held so far, stating, "The company plans to continue sincere negotiations and make efforts to find a prompt resolution."

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