Hyundai Motor Co. will put an end to the overnight shift in March next year, pending the approval by union members of the latest labor-management deal, which will be put to a vote on Monday. The change in the work pattern will undoubtedly improve the quality of life for employees.
The change will also have a far-reaching impact on the entire domestic auto industry, pressuring Kia Motors Corp., Hyundai’s sister company, and other domestic automakers to brace for union demands for a similar change. It will probably affect other industrial sectors as well.
Last week, labor and management agreed to put an end to Hyundai’s 45-year practice of two 10-hour shifts by adopting two shifts of eight hours and nine hours apiece. With the daily work hours set to be reduced from 20 to 17, now the question is how to make up for production losses. The automaker will have to raise productivity, expand production facilities, or both.
Reducing work hours by scrapping the overnight shift has long been one of the major labor issues in the nation. Unions have demanded a reduction in work hours in each of the two shifts so that the overnight shift will be abolished. According to one estimate, an average union member at an auto assembly line works 2,400 hours a year, more than the national average of 2,193 hours as well as the OECD average of 1,746 hours.
Hyundai expects yearly production to be down 185,000 vehicles because of the changes. The union agreed to make up for the loss by raising productivity on condition that no cut be made in the pay. That may not be an impossible goal, given that it takes 31.3 hours on average to assemble one vehicle in a Hyundai factory in the nation, compared with 14.6 in Hyundai’s Alabama factory and 19.5 hours in its Beijing factory. The question is whether or not the union will make good on its promise, instead of halting assembly lines over labor conflicts without qualms as it used to.
The union staged a series of partial strikes in July and August, demanding pay increases and improvements to the working conditions. At issue is how to make up for the losses from the walkouts, which the company put at 1.6 trillion won. The union will have to help the company meet its production target with extra work during the remainder of the year.
