Looming labor strike at HMM feared to disrupt Harim's takeover

Unionized sailors of HMM are threatening to go on their first-ever strike in the company’s history, thereby raising concerns over the possibility of setbacks in Harim Group’s plan to acquire the shipping firm and the shipment of goods from the Port of Busan, according to industry officials, Wednesday.

The union asked for arbitration by the National Labor Relations Commission, a day after it informed management that their collective bargaining had fallen through. If labor and management fail to reach an agreement after arbitration, the union can win a legal right to strike after a vote by its members.

While urging the company to raise wages and improve welfare, the union has also protested the government’s selection of Harim last December as the preferred bidder to buy HMM.

“Harim offered 6.4 trillion won ($4.8 billion) for the acquisition, but it has yet to clarify its plan to raise the money,” the union leader said. “It is expected to borrow an excessive amount of money or increase its capital unreasonably by issuing new stocks of its shipping subsidiary, Pan Ocean. In that case, the cash-strapped Harim will not be able to manage HMM properly.”

Given that the union seeks to prevent HMM from receiving a 13,000-TEU container ship from HD Hyundai Heavy Industries next month, the shipping firm may face a setback in its plan to deploy additional vessels bound for Europe, which is intended to help cope with the logistics crisis in the Red Sea. The union also plans to disrupt loading and unloading works, if the government signs the deal with Harim to privatize HMM.

Another HMM union consisting of employees working on land is considering a work-to-rule, a job action in which employees do no more than the minimum required by the rules of their contract and strictly follow time-consuming rules, which are normally not enforced.

The workers will take the action, depending on the result of the government’s first attempt at negotiation with Harim. Earlier this month, Minister of Oceans and Fisheries Kang Do-hyung told reporters that the result is expected to come out later this month.

Last Thursday, the two HMM unions held a forum in Busan with civic groups and minority shareholders to discuss the problems behind Harim’s plan to acquire the shipping company. They will hold another forum at the National Assembly in Seoul, Thursday, along with experts in various fields.