Kumho Labour Problems Solved

The recent labour dispute Kumho Tire in South Korea ended peacefully after “marathon” talks concluded peacefully on Saturday 5 September at 21:00. At the conclusion of the negotiations, local newspapers report that union workers agreed not to receive 2008 bonuses and to negotiate 2009 bonuses in the first quarter of 2010. As a result of the mutual agreement, Jooang Daily reported that Kumho management’s called off previously announced layoffs – a fact emphasized union sources. It is not clear if this means all 733 workers who were to be laid off on 24 August will now be able to work again.

Jooang quoted Kumho Tire as saying that the average annual salary of the 4,200 employees who work the company’s production line is 70 million won ($56,600). The company also said more than 30 per cent of workers receive an annual paycheck of more than 80 million won.

Worker pay at Kumho Tire in Korea has risen 11.5 per cent on average in the last five years, the company said, but productivity is only 70 per cent of the Kumho plant in China. Kumho estimates the economic loss from the partial strikes and plant shutdown at roughly 120 billion won.

Kumho shares leapt 14.93 per cent in early trading (07/09/09) in response to the news production will resume at the company’s three Korean plants.