March 15, 2018 / 10:02 AM / a year ago

GM's South Korean union seeks job, plant security in exchange for wage concessions

SEOUL (Reuters) - General Motors’ (GM.N) South Korean union said on Thursday that it will not demand a pay rise and bonuses this year, but instead wants the U.S. automaker to provide a future production plan and job security.

FILE PHOTO: The main gate to GM Korea's Gunsan factory is seen in Gunsan, South Korea February 13, 2018. Yonhap via REUTERS/File Photo

It marked the first time the union hasn’t demanded pay increases and bonuses during annual wage talks, a union official said.

GM, which last month announced the planned shutdown of one of its factories in South Korea, has proposed a base wage freeze and no bonuses this year as well a suspension of some worker benefits including school tuition for employees’ children.

In exchange for agreeing wage concessions, the union called on GM to detail a roadmap for new models, and distribute stocks worth 30 million won ($28,214)in GM Korea to each worker after swapping the nearly 3 trillion won of debt owed by the Korean unit to its headquarters into equity.

The union also wants an agreement under which GM would not lay off all employees at GM Korea for the next 10 years.

GM previously said it is looking to the union to “accept important concessions that can help address a lack of competitiveness in costs and productivity.”

The U.S. automaker is currently waiting on a final decision by the South Korean government to extend financial support to continue operating in the country.

“We make it clear that we are making concessions and sacrifices with unbearable pain, to protect jobs and survival rights of 300,000 workers,” the union said in a statement.

A GM Korea spokesman was not immediately available for comment.

Almost 2,500 workers at GM Korea, equivalent to 15 percent of its staff, have applied for a redundancy package that the U.S. automaker is offering as part of a drastic restructuring.

($1 = 1,063.3200 won)

Reporting by Hyunjoo Jin; Editing by Shri Navaratnam

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