Baek Byung-yeul is a journalist at The Korea Times focused on cultural content, including films and cultural events in South Korea. You can contact him at baekby@koreatimes.co.kr to share your insights.
CJ Logistics hurt by prolonged dispute with delivery workers
Parcel delivery workers belonging to the Korean Confederation of Trade Unions occupy CJ Logistics' headquarters building in Seoul, Monday. Yonhap
By Baek Byung-yeul
By Baek Byung-yeul
CJ Logistics CEO Kang Sin-ho
CJ Logistics has been in a prolonged dispute with a national parcel delivery union that has been on strike for nearly two months, according to company officials and industry analysts Tuesday.
The union has been claiming that the country's largest parcel delivery company took most of the profits it earned from a delivery fee increase, but company management refutes the claim, saying the revenue from the increase was used appropriately to improve the conditions of workers and consequently filed a complaint with the police against the union members that occupying its headquarters building.
They expressed concerns Tuesday about the situation in which the management and the union are strongly confronting each other. They said if the union continues to strike for a long time, it could result in negative effects to consumers who use the courier service as well as worsen the company's earnings.
Furthermore, they presume that failure to reach a compromise with the union could hurt the company's image when entering global logistics markets, such as the United States. This all comes at a time when the value of environmental, social and corporate governance (ESG), which is used to measure sustainable growth, has come to be of great importance.
“Both the management and the union are at fault. It is not desirable for the union to occupy the company building when dialogue and compromise are required. Also, I don't think it's the right choice for the company to take legal action against the union's illegal occupation of the company's building,” Kim Dae-jong, a professor of the School of Business at Sejong University, said.
“Failure to reach a compromise with the union will inevitably affect the company's image adversely. The company's plan to advance into the global market may also be hit hard."
On Feb. 10, about 200 union members under the Korean Confederation of Trade Unions (KCTU) occupied the company's headquarters in Seoul. They said it will consider staging an industry-wide strike unless the company agrees to their demands to ensure a better working environment.
“In order to preserve the social consensus of preventing overwork and death, we will fight to the end,” Jin Kyung-ho, head of the KCTU's courier union, said in front of the company's building, Monday.
The union is demanding direct negotiation with CJ Logistics regarding improving the working environment. But the company has refused to talk because delivery workers are categorized as self-employed by the law and they are just contracted by delivery agencies.
In June, 2021, the National Labor Relations Commission ordered CJ Logistics to directly negotiate with the union, but the shipping company denied the decision and filed for a court stay, saying the company signed contracts with delivery agencies.
The union claimed that the company raised the parcel deliver fee by 327 won ($0.27) compared to that in the first quarter of 2021, but only 76 won was used to improve the workers' working conditions.
“CJ Logistics took 240 won out of 327 won in the increase as their profit. Isn't it too much to take most of the amount raised thanks to the sacrifice of workers as profit?” Jin said.
A CJ Logistics spokesman said the union illegally occupied the building and used violence against the company's employees.
“The company's headquarters has become a scene where violence and illegal acts are committed at a level that is hard to see in a constitutional state. The courier union puts on a peaceful face only when media attention is focused on it, but after the media leaves, they are threatening employees including our security staff,” he said.
When asked if there could be inconvenience to customers due to the strike, the spokesman said, "About 1,500 delivery workers participated in the strike, which are less than 7 percent of the total 23,000 workers we are working with. Even ahead of the Lunar New Year holiday, 1,700 people were separately deployed to minimize damage.”