Settings

ⓕ font-size

  • -2
  • -1
  • 0
  • +1
  • +2

GM Korea union poised to strike over R&D spinoff plan

  • Facebook share button
  • Twitter share button
  • Kakao share button
  • Mail share button
  • Link share button
Rep. Chu Hye-seon of the Justice Party, fourth from right, speaks during a press conference at the National Assembly in Seoul, Thursday, to protest GM Korea's plan to spinoff its research and development unit. / Courtesy of Rep. Chu Hye-seon
Rep. Chu Hye-seon of the Justice Party, fourth from right, speaks during a press conference at the National Assembly in Seoul, Thursday, to protest GM Korea's plan to spinoff its research and development unit. / Courtesy of Rep. Chu Hye-seon

By Park Jae-hyuk

GM Korea's union said Thursday it will go on strike Oct. 22 unless the company scraps its plan to establish a separate corporate body for research and development.

The union also called on the state-run Korea Development Bank (KDB) to vote against the spinoff plan at the carmaker's shareholders' meeting which will take place at 2:00 p.m. Friday.

GM Korea has been allowed to hold the meeting after Incheon District Court rejected an injunction KDB had submitted to prohibit it.

The court ruled Wednesday that there was no reason to suspect that the KDB, the second-largest shareholder of GM Korea, would suffer serious damage if the meeting was allowed to take place. The bank, which holds a 17 percent stake in GM Korea, also opposes the spinoff plan.

"We are disappointed at the dismissal of the injunction that KDB had applied for. To prevent the spinoff, the bank must use its veto and apply for another injunction to invalidate the shareholders meeting," union head Lim Han-taek said in a press conference at the National Assembly, Thursday.

"It is time for labor and management to join forces for business normalization, but GM headquarters is trying to divide GM Korea in two. This is regarded as another attempt at restructuring following the shutdown of the Gunsan factory."

Union members already voted to go on strike in a two-day vote that began Monday ― 78 percent of the 10,234 members agreed to a walkout. They are waiting for the National Labor Relations Commission's decision on the labor dispute, which will likely be made Oct. 22.

On July 20, GM announced the plan to spin off its R&D unit from GM Korea's manufacturing facilities, saying the move would allow each unit to focus on their respective sectors and improve efficiency.

The union opposed the plan because 3,000 of its members would have to move to a new site after the spinoff, and due to suspicions that the move was a preliminary attempt to sell off the Korean unit, allowing GM to withdraw from Korea.

Rep. Chu Hye-seon of the minor opposition Justice Party said GM Korea's union would be helpless after the spinoff as workers belonging to the new unit would not benefit from collective agreements signed between labor and management.

"As GM Korea cannot withdraw from Korea for the next 10 years due to its agreement with the KDB, it may seek to cut costs by restructuring its manufacturing unit," the lawmaker said. "Even if workers at the manufacturing unit protest the restructuring, those at the R&D unit will not be able to help them."

KDB Chairman Lee Dong-gull has warned that the state lender will exercise its veto rights if GM Korea moves to create the R&D unit at the shareholders meeting.

However, GM Korea denied the union's claims, noting that the KDB invested $750 million in the carmaker on the condition that it would stay and normalize operations over the next 10 years. The carmaker also claimed the KDB cannot use its veto on the spinoff plan, saying it was not a matter for a special resolution at the shareholders meeting.

The KDB said it was considering taking legal action after the shareholders' meeting.


Park Jae-hyuk pjh@koreatimes.co.kr


X
CLOSE

Top 10 Stories

go top LETTER