Hyundai Heavy union strikes over layoff threat

The labor union of Hyundai Heavy Industries is scheduled to start another round of strikes today after the struggling shipbuilder, facing a shortage of new vessel orders, hinted at the possibility of more layoffs.

The two parties have been in wage negotiations since May last year, but have continually failed to reach a consensus. The company wants workers to take on the burden of a global shortage in shipbuilding orders, but the union has rebuffed the requests and staged walkouts in February and June over the issue.

Last Thursday, the company came to the union with offers of turnaround measures, including laying off some workers, instead of cutting their base pay by 20 percent as initially proposed, but workers again turned down the offer. Hyundai Heavy Industries said it would continue negotiating with the union.

“To resolve problems the company is facing, including order shortages and an idle workforce, we will enforce necessary turnaround measures like encouraging workers to use up their paid leave and laying off staff,” the shipbuilder said in a note sent to the union last week.

The union called the offer nonsense and said, “The company feigned generosity by taking back the suggestion to cut base pay, but it is only trying to justify its turnaround plans to come.”

The company wants to enact the turnaround measures next month.

“Compared to years before, our order backlog has declined steeply, and we are in dire need of cooperation from our workers,” a Hyundai spokesperson said. “Human resource restructuring is inevitable at this point.”

The shipbuilder has already suspended work at its Gunsan Dockyard in North Jeolla in July due to a lack of new orders and halted operations at its two docks in Ulsan last year. The company said the docks will reopen when enough new orders come in, but when that will happen remains uncertain.

The temporary closure of the Gunsan Dockyard has already put many of its 5,000 employees out of work.

“During the first half of the year, Hyundai Heavy Industries reaped net profit worth over 4.5 trillion won, and the company has been recording profit for six straight quarters,” the union said in a statement, claiming the company is exaggerating its management woes.

The company, though, said the profit was reaped mainly from the company’s turnaround efforts, including laying off workers and selling assets irrelevant to its core businesses.

BY KIM JEE-HEE [kim.jeehee@joongang.co.kr]