Major subsidiaries of HD Hyundai are on the brink of strikes due to labor disputes over bonuses. As the shipbuilding industry thrives and the construction machinery sector recovers, unions are demanding compensation that reflects these improved results, but negotiations with management have stalled.
On August 24, the Central Labor Relations Commission (CLRC) held a second meeting regarding the labor dispute application submitted by the Metal Workers' Union of Hyundai Heavy Industries. The commission concluded to halt mediation, indicating a significant gap between the positions of labor and management.
Since their first meeting on June 2, the union and management have held 15 rounds of negotiations without reaching an agreement. The union is demanding a basic salary increase of 149,600 won, a 100% increase in bonuses, and a distribution of at least 30% of operating profits as bonuses.
Considering that Hyundai Heavy Industries reported an operating profit of 2.0375 trillion won last year, a simple calculation shows that 30% of this profit would exceed 600 billion won for bonus distribution.
With the conclusion of the CLRC mediation process, the union plans to conduct a vote among all members from August 25 to 27 on whether to proceed with strike actions. If a majority of members support the strike, the union will secure the right to conduct a legal strike.
The turmoil over bonuses is not limited to Hyundai Heavy Industries. The unions at HD Electric and HD Construction Machinery also applied for labor dispute mediation with the CLRC on August 14.
Both companies received a halt to mediation after their second meeting on the same day. HD Construction Machinery, formed this year from the merger of HD Hyundai Construction Machinery and HD Hyundai InfraCore, faces labor relations challenges in its inaugural year.
This year, the central issue in labor disputes revolves around 'profit distribution.' The unions argue that with record-high performances in key sectors like shipbuilding and power equipment, employees who contributed to the company's growth should receive a more substantial share of the profits. Conversely, management contends that they must consider not only current performance but also potential market fluctuations, investment resources, and labor cost burdens.
The primary concern is that conflicts at major facilities could lead to actual strikes, which may impact HD Hyundai's management in the second half of the year. If simultaneous disputes arise in core sectors such as shipbuilding, power equipment, and construction machinery, the burden could be greater than individual facility strikes. Repeated partial strikes or prolonged labor disputes could also accumulate delays in production schedules and delivery responses.
However, market analysts believe that securing the right to strike is unlikely to lead to immediate full-scale strikes or significant production disruptions. An industry insider noted, "In cases of partial strikes, there is usually room to adjust production schedules, and the likelihood of major disruptions in fulfilling orders or product deliveries in the short term is low."
* This article has been translated by AI.
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