Hyundai Motor, South Korea’s largest automaker, said Tuesday it has reached a tentative agreement with its labor union on this year’s pay increase 119 days after the start of negotiations. On Wednesday, the labor union plans to hold a vote on whether to approve the agreement signed late Monday at the carmaker’s main production plant in Ulsan.

Under the agreement, unionized workers and management will set up a special pay system and standard wage reform committee that will tackle the tricky issue of clarifying to what extent regular bonuses should be considered part of a worker’s regular salary.

The issue took prominence after the Supreme Court ruled late last year that all types of bonuses, if given uniformly and regularly to workers, must be viewed as being part of standard pay.

Many companies including Hyundai Motor have been reluctant to include bonuses as part of the standard pay because it would raise overtime allowances and severance pay.

The two sides also agreed to raise basic monthly salaries by 98,000 won ($93), and give workers 300 percent bonuses and a further lump sum of 5 million won. The two sides agreed that a special 150 percent bonus will be given after Hyundai cars met initial quality standard ratings.

Besides these monetary awards, workers will be given 3.7 million won each for meeting production output targets this year, and 200,000 won in gift certificates.

The management also said it would extend the retirement age from 59 to 60. (Yonhap)