By Kim Hyun-cheol
Staff Reporter
The road ahead is becoming bumpier for Kumho Tires. Employees of the financially crunched company voted against tentative wage and collective agreements, causing all current processes under a debt restructuring program to halt.
In a two-day ballot of unionized workers that began Wednesday, only 44 percent of voters were for the wage agreement and 43 percent were for the collective agreement, which fails to reach a majority for either of them, Kumho's labor union said Friday.
Earlier this month, the tire maker's labor union and management reached an agreement in a bid for the company to undergo a debt rescheduling program. The agreement included a 10-percent pay cut and abolishment of most of the benefit system, in exchange for withdrawing layoffs for over 193 workers.
With two unionists opting for voluntary retirement, the company's management said it will go on with its plans to lay off the remaining 191 workers, who were notified of the decision through text messages on their mobile phones Friday.
Strong opposition from hardliners in the union was mainly attributable to the unexpected rejection of the plan, industry watchers say. Some of them reportedly staged a vote-off campaign prior to the ballot, stressing that the actual wage cut including additional cutbacks on extra pay reaches as much as 40 percent of what they annually receive.
As a result, the fate of the company is at the mercy of its creditors, leaving probabilities open for worse consequences such as court receivership, or even bankruptcy. A 100 billion-won ($89.5-million) emergency cash aid, which was approved by the creditors in February, will be also annulled.
Both parties are expected to brace for renegotiations, but a negative outlook is looming larger as the union rejected the tentative agreement proposed in the overall 22 rounds of talks over the last two months.
Creditors made it clear that suspension is inevitable in the current situation. They were supposed to have a presentation on the review of the company Friday, before setting off the negotiations for measures to bring the management of the company back to normal by next week.
``Not a single step can be made toward working this out without the completion of a union-management agreement,'' an official of the creditor side said on condition of anonymity. ``All the processes are based upon the result that we receive an agreement on the layoffs from the Kumho Tires union."
Kumho Asiana agreed with its main creditor, the Korea Development Bank, in December last year to put two units of the business group including Kumho Tires under a debt rescheduling program.
The conglomerate had been suffering a cash shortage caused by the delayed sale of Daewoo Engineering & Construction.
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