Hyundai Offers to Hire 3,000 In-Plant Supplier Workers

Hyundai offers to make 3,000 employees of suppliers who work in its Korean plants to full-time regular workers for the auto maker.

A spokesman tells WardsAuto the offer has been made in the latest round of collective bargaining and wage talks between the Hyundai and the Hyundai Workers Unit of the Korea Metal Workers Union.

However, union representatives have ordered partial strikes at all plants Tuesday (four hours) and Wednesday (eight hours) to maintain pressure on the auto maker. The two sides met Monday and will meet again Tuesday.

A union spokesman acknowledges Hyundai has made some compromise offers to settle some of their differences, but they fall short of the union’s targets.

The union seeks a monthly wage increase of 152,000 won ($134) and distribution of 30% of the auto maker’s net profit as bonuses. The union also is demanding an end to all night-shift work, with no employees working beyond midnight.

But the union says it will not accept any offer regarding wages or working conditions unless the contract supplier employees are converted to regular-employee status.

The Hyundai spokesman says 6,800 employees of suppliers are working in its plants in Korea. The auto maker has offered to convert 1,000 irregular workers who are paid by suppliers to regular worker status by the end of 2013. Another 2,000 would be reclassified as regular workers over a 4-year period.

Employees of suppliers and subcontractors who work in the plants are paid much less than regular Hyundai employees. They do not have equal benefits and are subject to dismissal at the discretion of their employer and of Hyundai managers, the union complains.

The 1,000 employees Hyundai proposes reclassifying this year work in various plants throughout Korea. Asked how this offer might benefit the auto maker, the spokesman says “Hyundai customers will benefit if the negotiations conclude quickly and successfully.”

The Supreme Court of Korea ruled earlier this year that an in-plant supplier employee who was dismissed in 2005 should have been granted regular-employee status because he had worked for more than two years in a Hyundai plant, worked alongside regular employees and did the same kind of work and reported to Hyundai supervisors.

Hyundai will not comment on civil suits filed by 1,900 of the in-plant supplier employees who are suing the manufacturer to try to get regular-employee status. The auto maker will not say whether any of the 1,000 workers whose status would be changed this year are among plaintiffs in the lawsuit.

Analysts say the partial strikes are having a severe impact on Hyundai production, as many of its models are selling strongly in Korea and export markets and inventories are very short.

The union ordered 18 partial strikes during July and August that cost the auto maker 52,791 units in lost production, valued at slightly less than 1.1 trillion won.