Costco Korea denies poor working conditions after employee's death

Industry

Published: 12 Oct. 2023, 19:09 Updated: 12 Oct. 2023, 19:59

Costco Korea denies poor working conditions after employee's death

CEO of SPC Shany Lee Kang-seop, left, and Country Manager of Costco Korea Cho Min-soo appear as witnesses during a parliamentary audit of the Ministry of Employment and Labor held at the National Assembly in Seoul on Thursday. [NEWS1]

Costco Korea's country manager Cho Min-soo vowed to enhance labor conditions and prevent a recurrence of the death of a worker in his 20s due to heatstroke in June during a parliamentary hearing on Thursday.

Yet Cho denied key allegations such as poor working environment and making disrespectful comments at the deceased worker's funeral.

The incident occurred on June 19 at the Hanam branch of Costco Korea in Gyeonggi, when the 29-year-old employee Kim Dong-ho, weighing 78 kilograms and standing at 177 centimeters, lost his life while organizing shopping carts at the parking lot. The incident unfolded amid a scorching heat wave with temperatures of 33 degrees Celsius (91.4 Fahrenheit), and the parking area where Kim was stationed reportedly lacking cooling facilities.

During the hearing, Lee Hack-young, a lawmaker, drew attention to the substandard working conditions at the Costco branch, highlighting the absence of rest areas, humidity and temperature control measures, adequate air circulation and cooling equipment.

However, the Korean country manager of the U.S. retail giant denied these allegations, asserting that most were "far from the truth."

Jin Sung-joon, another lawmaker, underscored the stark contrast in workplace accident rates relative to the number of employees, with Costco recording the highest figure at 12.2 percent when compared to other major Korean retailers such as Lotte Shopping (3.29 percent), Emart (3.47 percent) and Homeplus (4.65 percent). He noted that despite rules restricting the number of shopping carts an employee can handle — six per person — these regulations were apparently disregarded at the Hanam branch, with a photo showing one worker handling some 20 shopping carts.

Kim Dong-joon, the brother of the deceased worker, appeared at the hearing and criticized the company's lack of communication.

"It's been 116 days since my younger brother's tragic passing, and we didn't receive a single call from the company, and all we got was a short, impersonal apology email from Costco's senior vice president of Asia," Kim said. "During my brother's funeral, Cho and the Hanam branch manager even questioned the employees about any preexisting health conditions."

In response, Cho expressed condolences to the deceased employee and the family, yet denied the allegations, saying "such remarks were never made" at the funeral.

A shopping cart is placed in front of Costco Korea's Gwangmyeong headquarters in Gyeonggi on Aug. 2 as a tribute to a Costco employee who, due to working in scorching heat, had passed away while organizing shopping carts. [NEWS1]

Costco Korea also faced criticism for its passive stance in labor negotiations, with 25 rounds of discussions failing to yield an agreement and no collective bargaining accord in place.

"Domestic retail chains like Emart and Homeplus have all signed collective bargaining agreements, but Costco, despite having a labor union established for three years, has failed to reach such an agreement," said Jeong Min-jeong, head of the Mart Industry Labor Union. "Such a stance of disregarding the constitutional rights of workers for association and negotiation have fueled the tragic incident."

In his defense, Cho claimed to be actively addressing safety concerns by personally inspecting the premises and listening to feedback from employees.

"We will take legal action against Costco seriously," said the minister of employment and labor Lee Jung-sik. "It would be important to maintain an ongoing dialogue to peacefully resolve these pressing issues."

The hearing also featured SPC Shany's chief, Lee Kang-seop, who appeared at the hearing on behalf of the SPC Group Chairman Hur Young-in, who issued a formal apology for safety lapses within the group.

The Korean bakery giant, which had a worker in her 20s killed last October after being caught in a dough-making machine at their Pyeongtaek baking factory in Gyeonggi, faced a similar incident just this August at SPC Shany's Seongnam baking factory, where another worker in her 40s lost her life due to a similar accident.

"We pledged to invest 100 billion won ($74.71 million) for safety throughout the entire SPC Group, and by the end of September, we had channeled 32.5 billion won into safety measures," Lee explained. "Even though we made earnest efforts in safety investments, it seems there were some inadequacies, and I deeply apologize for that."

Yet when questioned about the matter of accountability, he refrained from assigning blame, citing the "ongoing investigations" as a reason for caution.

BY SEO JI-EUN [seo.jieun1@joongang.co.kr]