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Since the issue of “ordinary wages” was brought up in May during President Park Geun-hye’s visit to the United States, Korean firms have been beset by labor unions’ demands.
The unions want bonuses to be included in regular wage figures, which are used to calculate overtime allowances, severance pay and other benefits.
The inclusion of bonuses would hit shipbuilders the hardest, along with the automobile and steelmaking sectors, all of which are reliant on overtime work for their manufacturing schedules.
Currently, the nation’s top three shipbuilders ― Hyundai Heavy Industries, Samsung Heavy Industries and Daewoo Shipbuilding & Marine Engineering ― are all involved in lawsuits filed by their labor unions.
In the case of DSME, the company is simultaneously involved in two lawsuits, one a representative suit and the other a class action suit involving some 7,600 incumbent and former workers.
“We may not yet assert the social or economic aftermath of the suits, as both are still pending in the lower court,” said an official of DSME.
Officials of all three shipbuilders also refrained from making detailed comments on the issue, claiming possible influences on other industries.
The Korea Employers’ Federation estimated earlier that it would cost businesses some 3.8 trillion won ($3.3 billion), should the ordinary wage claim be accepted.
Reflecting such concerns, the Korea Chamber of Commerce and Industry board submitted a joint petition to the National Assembly earlier this week, urging the government to step in and resolve the dispute.
“The ordinary wage issue is causing great chaos to the industries,” they said in a statement.
“Should the scope of ordinary wages be expanded, it will lead to cost burdens on companies and eventually in the decrease of employment.”
According to the KCCI data, a total of 135 companies were involved in ordinary wage suits as of the end of May, and the figure is expected to be even higher if small firms with 100 or fewer employees are counted.
By Bae Hyun-jung (tellme@heraldcorp.com)
The unions want bonuses to be included in regular wage figures, which are used to calculate overtime allowances, severance pay and other benefits.
The inclusion of bonuses would hit shipbuilders the hardest, along with the automobile and steelmaking sectors, all of which are reliant on overtime work for their manufacturing schedules.
Currently, the nation’s top three shipbuilders ― Hyundai Heavy Industries, Samsung Heavy Industries and Daewoo Shipbuilding & Marine Engineering ― are all involved in lawsuits filed by their labor unions.
In the case of DSME, the company is simultaneously involved in two lawsuits, one a representative suit and the other a class action suit involving some 7,600 incumbent and former workers.
“We may not yet assert the social or economic aftermath of the suits, as both are still pending in the lower court,” said an official of DSME.
Officials of all three shipbuilders also refrained from making detailed comments on the issue, claiming possible influences on other industries.
The Korea Employers’ Federation estimated earlier that it would cost businesses some 3.8 trillion won ($3.3 billion), should the ordinary wage claim be accepted.
Reflecting such concerns, the Korea Chamber of Commerce and Industry board submitted a joint petition to the National Assembly earlier this week, urging the government to step in and resolve the dispute.
“The ordinary wage issue is causing great chaos to the industries,” they said in a statement.
“Should the scope of ordinary wages be expanded, it will lead to cost burdens on companies and eventually in the decrease of employment.”
According to the KCCI data, a total of 135 companies were involved in ordinary wage suits as of the end of May, and the figure is expected to be even higher if small firms with 100 or fewer employees are counted.
By Bae Hyun-jung (tellme@heraldcorp.com)
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Articles by Korea Herald
