South Korea’s largest shipper, Hyundai Merchant Marine (HMM), is looking to face its first union strike in over 45 years of operations. On August 23rd, union members voted for a strike after wage negotiations reached a deadlock following talks in previous weeks.
The union demanded a 25-percent pay raise alongside a bonus equivalent to 1200% of their wages. The demand was met with a counteroffer of an 8-percent wage increase with a 500% bonus by management. The talks fell through with union-members threatening to resign and applying to Swiss-Italian rival MSC.
This was a backlash to a 8-year wage freeze where HMM required a government bailout for a debt-equity swap with Korea Development Bank (KDB) back in 2016. With rival MSC looking to hire more employees while paying higher wages, HMM may lose a big chunk of its workforce if negotiations don’t conclude soon.
HMM’s record earnings this year boosted operating profit by 10 times to US $1.19 billion, a clear contrast to earning last year during the April-June period. On Monday, HMM saw its share price dip by 2.23 percent to 37,530 won. On August 30th, union members will reconvene to vote for a potential walk-out.