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| S-Oil's polypropylene plant in Ulsan / Courtesy of S-Oil |
S-Oil, LG Uplus, Doosan Heavy receiving 'voluntary resignations'
By Baek Byung-yeul
Mass layoffs in the aviation, automotive, telecommunications and heavy industries are rising as companies struggle with weakened performance amid the economic downturn and the spread of the novel coronavirus, according to companies Friday.
Asiana Airlines, LG Uplus, S-Oil, Doosan Heavy Industries and Construction, Renault Samsung and other companies said they are receiving "voluntary resignations" from employees.
While they struggle with the prolonged economic downturn due to trade disputes between the U.S. and China and Korea and Japan, the recent outbreak of the COVID-19 virus has forced them to take action to minimize possible risks.
S-Oil said it is considering receiving voluntary resignations from employees in manager positions or above. This is the first time the oil refining company has sought to lay off workers since its establishment in 1976.
The company suffered an earnings shock in 2019 due to a negative refining margin. Its operating profit was 639.5 billion won ($529 million), down 29.8 percent year-on-year.
The layoffs at S-Oil came as a shock given the energy company is known to offer high pay. According to a survey by job portal Job Korea, S-Oil had the highest annual salary of 137 million, on average, as of 2018 among the top 100 firms by market capitalization.
LG Uplus, the telecommunications arm of LG Group, is also discussing a voluntary retirement program with its labor union. If implemented, this will be the first round of layoffs since the company was established in 2010 after LG Telecom merged with LG Dacom and LG Powercom.
Airlines also are reeling from the spread of the coronavirus. Asiana Airlines, the country's No. 2 airline, said Tuesday that every employee will take unpaid leave because the virus has cut demand for air travel.
The carrier said it will cut the salary of its CEO, executives and department leaders by 40 percent, 30 percent and 20 percent, respectively.
Doosan Heavy is also planning a voluntary retirement program to cut costs as the company, which has faced operating losses for six straight years, has been hit hard by the government's nuclear-free energy policy.
The company said employees aged 45 and over are eligible for the retirement package ― about 2,600 out of its total workforce of 7,600.
