Compromise Likely in Hyundai Strike

Negotiations continued between the labor union and the management of Hyundai Motors. The two parties began fine-tuning key issues on July 20. The unionized workers launched a 4-hour strike on July 20 and 21 after a 6-hour strike on July 18 and 19. As the workers reduced hours on strike and management agreed on a compromise, a good climate for negotiations may allow the two parties to reach an agreement earlier than expected.

The labor union has argued for a salary increase, one of the key issues, saying that the amount proposed by the management (an additional 89,000 won) is less than last year’s pay raise, and the proposed bonus is not enough considering 2.3 trillion won of net profits last year. The management has expressed disapproval, citing high oil prices and rising raw material prices, but room for negotiation still remains.

The two parties are accelerating the negotiation process, worrying about a protracted strike in case they don’t reach an agreement before summer vacation starting July 29.

Early settlement is highly likely in that the negative public opinion on the strike that started June 26 is spreading at a time when the nation is suffering from consequences from heavy rains and floods, and shipping of automotives came to a halt because cars for export were not available.

Jae-Rak Jeong raks@donga.com