BUSINESS

GM Korea’s labor-management wage talks fall through

By Kim Bo-gyung
  • Published : Sept 13, 2017 - 15:59
  • Updated : Sept 13, 2017 - 19:12

The new CEO of GM Korea Kaher Kazem’s first wage talks with the labor union were canceled at the last minute due to procedural problems, the company said Wednesday.

The thwarted negotiation was anticipated to provide the new chief with a breakthrough amid persisting wage disputes.

In the last meeting with unionized workers in late July, before his inauguration, Kazem vowed to improve labor-management relations.

“I understand that GM Korea has produced an accumulated 10 million units,” he said at the time.

“Efforts will be made to improve the company and for GM Korea to start making profit.”

Meetings were also arranged each with employees and the media earlier this month.

The union has been pushing for a 154,883 won ($136.50) rise in basic salaries and for bonuses amounting to 500 percent of ordinary wages.

The company, on the other hand, is sticking to a 50,000 won rise in base pay and a 10.5 million won bonus.

CEO of GM Korea Kaher Kazem (GM Korea)

GM’s unionized workers staged a four-hour-long partial strike on Sept. 5, when Kazem visited the headquarters to meet with GM Korea employees.

During the meeting, Kazem emphasized that all employees have to change to maintain competitiveness for a sustainable future, as the company has seen losses for three years in a row.

GM Korea posted a 634.1 billion won deficit last year, totaling an accumulated loss of 1.9 trillion won over the past three years, the company said.

Between January and August this year, GM Korea sold 361,716 units worldwide, down 7.1 percent on-year.

As part of efforts to calm rumors of the company exiting Korea, Kazem met briefly with reporters earlier this month to highlight the importance of the Korean market.

GM’s appointment of Kazem, who previously led the withdrawal of GM India, as the new head of Korea earlier this month, alongside GM’s global restructuring efforts, have raised the possibility of the unit ending operations here. 

By Kim Bo-gyung (lisakim425@heraldcorp.com)