Ministry honors firms fostering smooth labor ties
Published: 30 Sep. 2009, 04:51
Ministry of Labor has granted awards to 12 corporations for their excellence in maintaining solid labor and management relations. The ministry has presented such awards since 1996.
Dongbu Steel and Hyundai Heavy Industries were awarded presidential prizes at the ministry’s 2009 Labor-Management Culture Awards. The companies will be exempted from the labor supervisor’s audit of the company for three years and be given several other government incentives.
The ministry said Dongbu’s commitment to improving employee working conditions while overcoming the economic crisis through voluntary cuts in employee salaries during the past two years deserves recognition. So, too, does Hyundai Heavy Industries’ efforts to transform its militant labor union into a cooperative body, according to the ministry.
“While [Hyundai Heavy Industries] has maintained a no-work no-pay policy, it also sought ways to simultaneously enhance the workers’ quality of life and job security,” the ministry said. “This March, management and labor adopted a labor-management peace declaration, setting an ideal precedent for labor-management relations in Korea.”
Hyundai Heavy Industries had suffered severe labor-management disputes ever since its labor union was established in 1987. Until 1994, workers engaged in massive strikes demanding improvement in working conditions, prompting retaliatory actions by the company. The ministry said the once-problematic labor and management relations have seen smooth sailing since 1995.
In February, Oh Jong-soae, head of the labor union at Hyundai Heavy Industries, entrusted decisions on workers’ wages to the company for the first time in the union’s history. In return, management ensured employment for the workers. Following in the Ulsan-based shipbuilder’s footsteps, other labor unions based in the city also entrusted decisions on workers’ wages to their companies or agreed to wage freezes.
Hyundai Heavy Industries’ labor and management donated company revenue to the regional community. When the traditional Korean market in Ulsan suffered a drop in sales because of large wholesale supermarkets, the company spent 900 million won to purchase the traditional market’s gift cards. “Hyundai Heavy Industries’ labor union was at the forefront of improvements in labor-management relations among Ulsan-based companies this year,” said Lee Ki-won, head of Seoul Regional Labor Relations Commission.
Choi Kil-sun, CEO at Hyundai Heavy Industries, said, “The labor-management [relations] have crossed the line of partnership and are the main body running the company.” Under Dongbu Steel’s philosophy that “family and work are inseparable” the company overcame the economic crisis by restructuring workers. The philosophy was set up in June 2001 under an agreement by management, workers and their families.
The philosophy stresses that families and the company are inseparable and rise and fall of both are closely tied. In other words, peace in the family is a stepping stone for the company’s advancement, according to Dongbu Steel officials.
Han Kwang-hee, CEO of Dongbu, said the company’s philosophy is in its DNA. “Dongbu has changed workers’ wages without labor-management wage negotiations for the 14th straight year, the Labor Ministry said. “It’s also remarkable how both sides overcame the financial meltdown last year with the labor union voluntarily deciding to return their salary and with management 100 percent guaranteeing workers’ employment in return. This is an example of mutual trust between management and labor.” Last year, Dongbu spent 1 trillion won to build an electric furnace while the financial crisis battered Korea. The company was on the brink as its factories operated at below 30 percent of their capacity.
Dongbu workers voluntarily agreed to slash their pay by 30 percent while their families joined the belt-tightening by cutting hagwon expenses for their children. The construction of the electric furnace was completed thanks to those moves and Dongbu became the only steelmaker in the country that has cut pollutant emissions by 50 percent.
“Whenever risks arise, we turn them into opportunities under the company’s philosophy,” said Park Hui-joon, the labor union head at Dongbu Steel. “The only thing that lies ahead of us is a grand mission to become a proud steelmaker that has high work efficiency and produces the world’s highest quality steel.”
By Kim Ki-chan, Kim Mi-ju [[email protected]]
with the Korea JoongAng Daily
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