No Jobs in Aid Package for Laid-Off Ssangyong Workers

Following live-in tent demonstrations by laid-off Ssangyong workers and critical newspaper editorials, the Korean auto maker announces an agreement with the employees’ union to help 455 of its unpaid, furloughed members.

A Ssangyong spokesman tells WardsAuto the company does not use the term “laid-off,” instead calling the employees in question “workers who are on unpaid leave.”

No matter the language, the 455 former Ssangyong employees have been out of work since 2009, following a violent 77-day sit-in strike in front of the auto maker’s headquarters in Pyongtaek, South Korea, in December of that year. It resulted in many injuries and arrests and ended only after special police and SWAT teams used helicopters to storm the occupied plants.

By August 2009, Ssangyong had eliminated 2,646 jobs, declaring the employees redundant. Most were terminated, but 461 workers accepted an option to take one year of unpaid vacation. The furloughs now are in their third year and the auto maker has put none of them back on the payroll but still calls them employees.

The aid package for the 455 workers on unpaid leave neither puts them back on the job nor includes any direct cash payouts. Instead, each will receive 450 shares of Ssangyong stock, which is trading on the Korean Stock Exchange at 5,740 won ($4.92).

The auto maker also will assist the workers in paying for their children’s school tuition and expenses. Elementary, middle and high schools charge tuition in many parts of South Korea.

The aid package promises unspecified “gifts” for the workers’ families on major public holidays, such as Chuseok Thanksgiving in the autumn and the lunar New Year.

There also is a general pledge by Ssangyong to helping the workers seek new employment.

The auto maker says it may restore some of the jobs in 2014, five years after it imposed the unpaid leaves.

Ssangyong says business is improving markedly, but it still has not achieved results that would justify putting any of the 455 workers back on the payroll.

The auto maker’s sales were up 6.9% through March, compared with year-ago, to 26,441 units. Revenues for the first quarter increased 3.8% to 644 billion won ($552 million), and the company’s operating loss fell 22% to 32.6 billion won ($28 million).

Under its New Vision Declaration program, Ssangyong is targeting sales of 160,000 vehicles annually by 2013, with revenues of 4 trillion won ($3.4 billion). Beyond that, the auto maker aims for 300,000 deliveries – the full capacity of its Pyongtaek plant – and 7 trillion won ($6 billion) in revenues in 2016.

A Ssangyong workers union spokesman claims that since the auto maker downsized in 2009, 19 former employees or their family members have died because of depression-related causes, including four suicides.

The union also says workers who actively participated in the December 2009 sit-in strike cannot find new jobs because of the stigma of the violence. Union activists set fires and fired objects from slingshots at workers and police during the 77-day occupation of the Pyongtaek plant.

Since 2011, Indian auto maker Mahindra & Mahindra owns 70% of Ssangyong, whose 3,300-member workforce comprises workers, management and professional staff.

In addition to the headquarters and vehicle-assembly complex in Pyongtaek, Ssangyong operates a research and development and design center and two engine-development and -production plants in the southern city of Changwon.