The board of the Korea Railroad Corp on Tuesday approved a plan to establish an affiliate for a new bullet train operation despite a general strike by workers who claimed the spin-off was a disguised step toward privatization.

During a closed-door meeting held an hour ahead of schedule, 12 of the 13 board members voted in favor of the plan.

“The company for the new KTX operation is an opportunity to increase the quality of the railway operation and service as well as KORAIL’s competitiveness,” KORAIL CEO Choi Yeon-hye said after the meeting.

“Participating in the ‘illegal’ rally will help nobody. Workers should return to work,” she said.

Calling the move a “privatization ploy,” the Korean Railway Workers’ Union launched a walkout Monday. The union denounced the board’s decision and threatened to escalate its protest.

The union also said it would take legal action to nullify KORAIL’s decision, claiming that it was approved by board members who are not qualified for the posts.

“The board’s decision will cause damage to the company and harm the public. We will block the plan by taking all possible legal action,” the union said, adding that it plans to file charges of malpractice with the prosecution against the board members.

Conflicts deepened between two sides as the company threatened to take legal action against those involved in the strike while the union refused to step back.

On Monday, KORAIL filed complaints with police against nearly 200 union members for impeding business and dismissed more than 4,200 workers who participated in the walkout. The police said Tuesday that they have sent requests to 187 union members, including their leader Kim Myung-hwan, to attend questioning. If they refuse more than three times, the police will seek arrest warrants, officials said.

On the second day of the strike, no major disruption to passenger train services was reported. KTX high-speed train and subways operated normally as of Tuesday afternoon. The ongoing strike, however, has started to cause cargo transport delays, partially as the company has reduced operations by nearly 70 percent.

The union has been staging a sit-in protest in front of Seoul Station, where the Seoul office of the Daejeon-based rail operator is located. A massive rally was planned to take place on Tuesday evening with support from hundreds of civic groups and the Korean Confederation of Trade Unions, a progressive union umbrella group.

The union has been at odds with the management over setting up a subsidiary to separately operate the new KTX route connecting Suseo, southern Seoul, to major southern cities.

The union believes the plan would eventually lead to privatization, mass job losses and fare hikes.

The rail operator lashed out at the union, saying that it does not intend to privatize the state-run company, but instead improve management efficiency.

KORAIL stressed that it would draft a measure to block private investors from joining the project. The union countered that the rules could change anytime.

By Cho Chung-un (christory@heraldcorp.com)