Hyundai Motor Co. faces a bad start for the New Year with a fullscale strike looming on Jan. 2, the first regularly scheduled work day of 2018.

For the first time ever, no agreement on wage increases was reached during the negotiating year, so both sides remain at loggerheads although they have vowed to settle differences as soon as possible.

Union representatives met in negotiations with management on Dec. 26, but the next day Hyundai issued a statement saying no agreement had been reached.

The New Year’s holiday began with the close of business on Friday, Dec. 29 (Korea time), with production scheduled to resume next Tuesday, Jan. 2. However, union sources say they will down tools for two full shifts beginning on that date with the fullscale strike continuing until Hyundai improves its wage offer.

On Dec. 19, the union had provisionally agreed to a 58,000 won ($54) average monthly wage increase, a bonus of three months’ pay, and a 3 million won ($2,800) incentive signing bonus.

However, on Dec. 22 the tentative agreement was rejected by slightly more than half (50.2%) of the 45,000 workers who voted. The two sides then resumed negotiations without reaching an agreement.

The union says workers rejected the tentative offer because it is less than they won in the 2017 wage agreement package. The 2017 package was ratified by 63% of voting workers on Oct. 15 last year after a second tentative wage deal had been reached on Oct. 12.

The ratified 2017 agreement saw workers receive a 72,000 won (then $63) average monthly wage increase, 3.5 months’ pay, a 3.3 million won (then $3,000) signing bonus, 500,000 won ($440) in store vouchers and 10 shares of Hyundai common stock.

The 2017 wage agreement was reached last year after 24 rounds of negotiations that lasted for six months, compared to 40 rounds this year that have dragged on for eight months and are still in progress.

Lack of a settlement at Hyundai also has an impact on its affiliate Kia Motors, as well as on their struggling competitor, GM Korea. 

Kia and GM Korea also end the year without a wage settlement, although their unions have not said they will wage fullscale strikes.

Hyundai wage settlements traditionally have been a bellwether for both Kia and GM Korea and they factor the scale of Hyundai offers and settlements into their own negotiations.

The unions at Hyundai, Kia and GM Korea are all branches of the fiery Korean Metal Workers Union, which sets the wage bargaining criteria for all three companies.