[EDITORIALS]Kia union's improprietyThe labor disputes at Kia Motors Corp., Korea's second-largest carmaker, are raising concerns. The company's union members began their muscle-flexing rallies on June 24, accusing management of insincerity during ongoing negotiations. On Monday, negotiators broke off talks after workers were on the job for four hours. Three weeks of partial strikes have interrupted production of some 27,000 vehicles, costing the automaker about 340 billion won ($289 million). As orders for new vehicles pile up, domestic and overseas Kia customers are waiting impatiently for their automobiles.
With good reason, the Korean public is looking coldly at the renewed strikes at Kia. Five years ago, the company was teetering on the verge of bankruptcy due largely to its militant union and corrupt executives. Presidential candidates tried to help salvage what was then called the "people's company," but to no avail. In late 1998, the government allowed Hyundai Motor Co. to take over the ailing firm and ordered banks to write off a staggering 7.1 trillion won of Kia's debts in a desperate attempt to keep the firm running. The government then covered lenders' losses from the debt write-offs with state bailout funds. Kia returned to profitability by 2000; it would be fair to say that the carmaker was rescued with taxpayers' money.
Kia's union cannot avoid criticism that the latest labor dispute is caused by its outrageous demands. There is room for negotiations in the union's demand of a 12.5 percent increase in basic wages and a 100 percent hike in piecework compensation. But demands like requiring management to obtain consent from the union if the company wants to transfer workers to other assembly lines or move factories violate management rights. The union also wants to fill half of the seats on the firm's disciplinary committee with union members. Such demands are a reminder of a similar case five years ago, when the union blocked the transfer of workers from assembly lines producing a vehicle that did not sell well to a line rolling out one of the firm's best-selling cars. Fortunately, the union's walkouts are within the law. Considering the public's view, the union should not make excessive demands or resort to more work stoppages, and management should end the dispute quickly.