Hyundai Heavy reaches wage agreement

Unionists at Hyundai Heavy Industries, the world's largest shipbuilder, on Monday approved the latest wage agreement negotiated with the management, ending a dispute that had dragged on since May.

The deal was accepted by 65.9 percent of an estimated 15,400 union members, the company said in an e-mailed statement. The union has about 16,000 members.

The two sides had reached a tentative agreement on the pay raise on Dec. 31, but that deal was rejected by the union.

The new agreement, like the previous one, includes a basic pay increase of 37,000 won (US$33.60) per month and a special bonus of 2 million won. The main difference is an overhaul of the wage system for junior-level workers.

Hyundai Heavy posted a net loss in the fourth quarter last year for the fifth consecutive quarter, although it managed to narrow the losses.

The shipbuilder came under a heavier financial burden after a local court last week ruled that the company must treat regularly paid bonuses, equivalent to 800 percent of the base pay a year, as regular wages, effectively increasing the baseline in calculating overtime and holiday shift pay as well as retirement pensions.

Hyundai Heavy was estimated to shoulder 629.5 billion won more in additional pay. The ruling's impact, however, was cushioned as the company had already agreed to include a yearly bonus worth 700 percent of the base wage into the salary.

The court ruling also covers workers at Hyundai Mipo Dockyard, a unit of Hyundai Heavy. (Yonhap)