SC First’s efforts to end strike fall apart

Union to make protest visit to London; Hill to appeal to media

By Kim Jae-won

The union of SC First Bank declared negotiations with the management stalled without any result Friday. Union leader Kim Jae-yul said in a news conference in front of the bank’s headquarters in downtown Seoul, “We will continue our strike indefinitely.”

Kim and four others will leave for London to take the matter to the bank’s masters in tandem with British banking unions.

Meanwhile, CEO Richard Hill showed up at a regular meeting of bank CEOs hosted by the Bank of Korea Gov. Kim Choong-soo. Hill was quoted as saying that the union was trying to politicize the strike, expressing his disappointment about its recalcitrance.

Hill said that management gave way to the union’s demand for a task force to deal with its proposed performance-based salary system. He said that he went to the extent of dropping the controversial issue from the negotiations first in order to normalize the bank’s operations, accusing the union of insisting on maintaining early retirement on an annual basis.

The breakup of their talks came at a time when the two sides held a series of overnight meetings for the past couple of days.

“We will go to London and visit headquarters of Standard Chartered,” said Oh Chi-hwa, a senior officer of the Korean Financial Industry Union (KFIU).

SC First said that the lender reported it to its headquarters, but was not sure whether the union leaders could meet executives of the U.K. banking group.

Meanwhile, Hill will invite journalists on Monday to explain the management’s position on the union and the strike.

About 2,900 unionized SC First workers out of 6,500 employees have staged a strike for four weeks since June 27 in a resort in Sokcho, Gangwon Province in opposition of the performance-based salary system, which the management wishes to implement for the first time in Korea’s banking industry.

“Richard Hill, CEO of SC First, suggested the revised version of conditions when he met union leader Kim Jae-yul on Wednesday evening,” said the lender in a statement.

The bank said it accepted to raise wages by 2 percent for permanent workers and 4 percent for contract workers this year. Instead, the lender asked the union to change its early retirement program to the average level of its local competitors. However, the union argued that the bank should pay 24 months of additional severance for workers retiring early, according to the lender.

“Both parties engaged in hours of discussion on Wednesday night to narrow their differences, but failed. Union leaders refused to resume talks, and went back to Sokcho Thursday afternoon,” said a spokesperson of the bank.

Customers have withdrawn 1 trillion won ($947 million) in deposits from the country’s sixth-largest commercial lender since the start of the walkout, prompting the financial watchdog to order SC First to ramp up its liquidity management to minimize the impact of a bank run sparked by the prolonged strike.