Major subsidiaries of HD Hyundai are at a crossroads of potential strikes due to labor disputes over bonuses. As the shipbuilding industry thrives and the construction machinery sector recovers, unions are demanding compensation that reflects improved performance, but differences between management and labor remain significant.
On August 24, the Central Labor Commission held a second meeting regarding the labor dispute mediation requested by the Metal Workers' Union of Hyundai Heavy Industries (HD Hyundai Heavy Industries). The commission concluded that mediation would be halted due to the stark differences in positions between the two sides.
Since their first meeting on June 2, the labor and management of HD Hyundai Heavy Industries have engaged in 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 profit as bonuses.
Considering that HD Hyundai Heavy Industries reported an operating profit of 2.0375 trillion won last year, a simple calculation shows that the bonus pool would exceed 600 billion won if 30% of the operating profit is shared.
With the conclusion of the mediation process, the union plans to conduct a vote among all members from August 25 to 27 to decide on the legitimacy of a strike. If a majority of members support the strike, the union will secure the right to engage in legal strike action.
The turmoil over bonuses is not limited to HD Hyundai Heavy Industries. The unions at HD Hyundai Electric and HD Construction Machinery also applied for labor dispute mediation on August 14.
In particular, HD Construction Machinery is set to hold a second meeting regarding the mediation requested by the union at 4 p.m. on the same day. Given the significant differences in positions, it is likely that HD Construction Machinery will also accept a decision to halt mediation. This company was formed this year from the merger of HD Hyundai Construction Machinery and HD Hyundai InfraCore, marking a challenging start for labor relations in its inaugural year.
This year, the central issue in labor disputes is 'profit distribution.' The union argues that with core businesses such as shipbuilding and power equipment achieving record performance, employees who contributed to the company's growth should receive a more substantial share of the profits. Conversely, management maintains that it must consider not only current performance but also potential market fluctuations, investment resources, and labor cost burdens.
The biggest concern is that if conflicts at major business sites escalate into actual strikes, it could pose challenges for HD Hyundai's management in the second half of the year, which is currently thriving. If simultaneous disputes arise in key sectors such as shipbuilding, power equipment, and construction machinery, the impact could be greater than individual strikes. Repeated partial strikes or prolonged labor disputes could also lead to cumulative disruptions 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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