New violence broke out over the weekend at beleaguered Ssangyong Motor Co. Ltd.’s Pyeongtaek plant in South Korea, following a breakdown in talks between management and the union over clearing out strikers who have staged a sit-in for the last 72 days.
A Ssangyong source says the auto maker is out of options and must rely on police to clear out the strikers. Management still is hoping to submit a viable reorganization plan to creditors that it says could save the company from liquidation.
A small management team led by Ssangyong’s court-appointed receiver Lee Yoo-il and union representatives reportedly met seven times to work out differences since talks began on Friday morning. But the negotiations ended in a bitter parting at 4:30 a.m. Sunday.
The union then issued an ominous statement calling the proposal management had offered totally unacceptable and warning workers were going to make a “last-minute struggle.”
Immediately, about 100 strikers decided to give up and left the plant property. All were questioned by police and those thought not to have committed criminal acts were allowed to go home.
Ssangyong management says it offered to significantly reduce the number of workers to be cut, but the union backed off its promise to compromise and instead insisted no employee should lose his job. The union also demanded no civil or criminal charges be brought against the strikers for violent acts or damage to the company.
By 10:30 am (Korea time) Monday, Ssangyong had moved 1,700 employees into various parts of the plant, ready to take positions on the assembly line areas held by the strikers, a source in the plant told Ward’s by cell phone at the time.
But trouble soon came when police and employees drove forklift trucks to remove new Ssangyong cars the strikers were using to barricade roads near the paint plant.
“The strikers are firing a hail of nuts and bolts, and they are throwing fire bombs as we try to move the cars,” the source reported. “We are moving about 10 new cars parked in front of the paint plant…as well as stacks of shipping pallets and other obstacles.”
He said the cars came from production inventory confiscated by the strikers.
Later, a group of 300-400 demonstrators from the Korea Metal Workers Union and the Korean Confederation of Labor Unions, an umbrella union organization, advanced on the plant to try to gain entry. They used iron rods and poles to beat at police and threw stones and other objects. Some people were injured.
Management finally decided the situation was too dangerous and pulled employees away as police took over.
“We had to shut off electricity in the assembly line area and the paint shop,” the source says. “It’s the only way we can force the strikers to give in. We realize (this) will cause some serious damage to the equipment, but we had no choice…Police plan to move in, but we don’t know when it will happen.”
Ssangyong’s initial restructuring plan called for a 36% jobs reduction, affecting 2,646 employees. A voluntary retirement plan was offered in implementing the plan and 1,672 employees accepted. The other 974 did not and instead armed themselves and seized the plant.
The auto maker now says it’s willing to cut only about 300 of the 974 jobs if the strikers will stop their sit-in. This would be done by retaining 290 employees but placing them on unpaid leave. Another 100 employees would be given sales positions.
Of the remaining 585, the company proposes 253 be assigned to jobs in parts of the company to be spun off as separate businesses. Therefore, only 331 workers actually would lose their jobs.
Ssangyong reported a total production loss of some 14,000 vehicles through Sunday, valued at 300 billion won ($246 million).