ULSAN — HD Hyundai Heavy Industries (329180) and its labor union reached a second tentative agreement on this year's wage and collective bargaining talks, about three weeks after the first deal was voted down. The revised package raises the lump-sum payment and the seniority-step pay increase while improving the formula used to calculate severance pay.
The two sides reached the second tentative agreement at the 26th main bargaining session held at the company's Ulsan headquarters on the 23rd, according to HD Hyundai Heavy Industries. The deal came 143 days after talks opened on June 2 and 23 days after the first tentative agreement was announced on Sept. 30.
The second tentative agreement calls for a monthly base pay increase of 120,000 won, including a seniority-step raise of 55,000 won, a lump-sum payment of 11.5 million won plus 200% of contractual wages in incentives and other one-off payments, and performance-based bonuses.
The total base pay increase of 120,000 won is unchanged from the first tentative agreement, but the seniority-step portion rose by 5,000 won. The lump-sum payment increased by 500,000 won to 11.5 million won from 11 million won. The company will also provide an additional 300,000 welfare points this year only. Total compensation per association member, which averaged about 40.56 million won under the first agreement, is expected to top 41 million won with the latest increase.
Provisions on workplace systems and employee benefits were also strengthened. The standard for calculating severance pay will be unified as "three consecutive months of the employee's choosing out of the four months before retirement," replacing the previous standards of three months at HD Hyundai Heavy Industries (HHI) and six months at HD Hyundai Mipo (HMD). The two sides also agreed to pay cooperation funds retroactively to June 1 of this year and to run the retirement program for four days for those reaching retirement age and two days for those being rehired.
The two sides reached their first tentative agreement on Sept. 30, but it was rejected at a union general meeting on Oct. 2. Labor and management then resumed working-level and main bargaining sessions, negotiating over an expanded compensation package reflecting demands raised by association members on the shop floor.