More Unions Refraining From Striking Over Wages

“To establish mutually beneficial, harmonious and forward-looking labor-management relations without precondition, we entrust the company with this year’s wage negotiations,” said Kim Byeong-seok, the union leader of LS Industrial Systems’ plant in Janghang, South Chungcheong Province.

Kim made the announcement last week in this year’s first round of collective bargaining with management. The company was pleasantly surprised over the unprecedented move by the 53-year-old union to hand over wage negotiations to management.

“Tears welled up in my eyes,” said LS President and CEO Koo Ja-kyun.

Kim told The Dong-A Ilbo on the phone yesterday, “As the company’s operating profit rapidly deteriorated due to a surge in raw material prices, the unionists have agreed that the company’s success is in their best interests. Unions in the 1980s and in the 2000s cannot be the same.”

○ Fewer strikes over wages

Leading labor groups in the country are sticking to a hard-line stance, with the Korean Confederation of Trade Unions to stage a general strike from late this month to early July. Nonetheless, more unions have agreed on wage freezes or concluded peaceful collective bargaining with management.

According to the Korea Employers Federation, the unions of GS Caltex, Korea Kumho Petrochemical, Daewoo Shipbuilding and Marine Engineering, Dongkuk Steel Mill, POSCO Refractories and Environment, POSCO Machinery and Engineering, KISWIRE, Amore Pacific, Hu-Chems Fine Chemical Corp., Pyeong Hwa Automotive and Chin Hung International will let management decide wage increases this year.

The unions of LG Electronics, Hynix Semiconductor, Korean Air and Kolon have also agreed to wage freezes to share the burden of unfavorable market conditions.

Hynix is celebrating its 21st consecutive year of no strikes, followed by LG Electronics with 17, liquefied petroleum gas importer E1 13 and Noroo Paint and Coating 10. Hu-Chems, which was split from Namhae Chemicals, has settled a wage negotiation without a strike for the first time since it was founded in 1974.

The public sector is no exception. Following peaceful bargaining by the Seoul bus union last year, labor and management of Daegu bus companies have also reached a wage agreement without a strike.

○ Evolving unions

Though the prospects of companies with militant unions remain murky, experts say the general atmosphere of labor-management relations could considerably change soon.

The Labor Ministry said the number of labor disputes jumped to 462 in 2004 from 322 in 2003, but has gone down since, dropping to 287 in 2005, 253 in 2006 and 212 in 2007.

The number of days lost due to strikes, or the number of days on strike multiplied by that of striking workers, also dropped to 630,685 days last year from 1.58 million days in 2002.

Business leaders say they are excited over the trend as more unions are helping their companies in the midst of worsening conditions, such as skyrocketing raw material prices and global economic uncertainty.

Kolon’s plant in Gumi, South Gyeongsang Province, went on strike for 64 days in 2004, but voluntarily agreed to a wage freeze this year.

“Since the company was having a hard time, we found it difficult to ask for raises,” said Song Pil-seop, public relations manager of the plant’s union, to the Dong-A Ilbo. “So we persuaded our union members to endure a few more years, and among 98.8 percent of unionists who voted, 97.5 percent agreed to a wage freeze.”

Kolon Group Chairman Lee Woong-yeul said, “The Gumi plant once broke my heart the most by causing a public stir, but has now touched my heart the most.”

E1 union leader Lee Seung-hyeon said getting what workers want such as a good income, welfare and job security by fighting is an outdated way of dealing with management.

“A cooperative atmosphere between labor and management at individual workplaces is spreading as a global trend amidst international competition,” said Nam Seong-il, dean of the graduate economics school at Sogang University in Seoul. “Korea is the only country where upper labor groups still drag the feet of certain unions for political reasons.”