A step in the right direction

The Hyundai Motor labor union has accepted a proposal by management to freely move workers to production lines with strong demand, following a similar move by the Kia Motors labor union. Despite high productivity, the method has not been used effectively due to union resistance. Concerns about job insecurity amid the global economic slowdown were a direct cause for the two labor unions’ concession. But it is still good news that one of the productivity-hindering factors between workers and management has been cleared away.

But this is only the beginning of the process to correct problems in labor-management relations in our auto industry. American car manufacturers say they were pushed to the edge of bankruptcy because of labor’s hard-line demands. Things are no better in Korea. In some ways, the situation here is worse. Labor unions here frequently go on strike for political causes that are irrelevant to working conditions, and through contract negotiations, unions threaten management’s right to run their companies. This is seldom seen in other countries. If we don’t end these destructive arrangements, our auto industry might follow in the footsteps of the United States.

Thanks to the recent agreement, the groundwork for cooperation and coexistence is in place. Both labor unions and management must find ways to increase productivity during a global economic slowdown. Adjusting currently disorganized contract negotiations to global standards will be the first step. The regulation that requires companies to get labor’s agreement when they introduce new technologies goes against market principles. Such measures must be abolished.

We should try to find measures to solve the problems that lead unions to call militant strikes and break their contracts. As branch unions are under industrial trade unions, which fall under an umbrella union, automakers are dragged along by the unions for more than six months when it is time to negotiate a new contract.

If the trade union system can’t be changed immediately, negotiation channels must at least be consolidated to increase efficiency. Management must abandon the view that it would rather meet labor’s unreasonable demands than cause problems in production. Management must not be obsessed with short-term output.

It should turn down suggestions or requests from the union if they are unreasonable. Companies can reward workers who make concessions to overcome the crisis with job security.