Militant union rises as another threat to banks

KB Kookmin Bank union leader Park Hong-bae chants during the proclamation ceremony of the bank's strike at Jamsil Students' Gymnasium in Seoul in this Jan. 8 file photo. He was elected as the new leader of the Korean Financial Industry Union. / Yonhap

By Park Jae-hyuk

Banks have been alarmed at the emergence of militant union leaders, as they are set to demand a further wage hike amid worsening business conditions, according to industry officials, Thursday.

On Tuesday, the Korean Financial Industry Union elected KB Kookmin Bank union leader Park Hong-bae as the new head of the umbrella union. Park will officially start his three-year term early next year.

He has drawn public attention since last January when he led KB Kookmin Bank's first strike in 19 years.

Back then, the union called for an unprecedented 300 percent incentive, while the management offered a 250 percent incentive, citing other banks.

As Park was elected as the new leader of the umbrella union composed of individual bank unions nationwide, more lenders will likely face bigger pressure to increase their salaries.

Park promised to block management from introducing a performance-based payment system, urge management to revise its employee evaluation criteria measured by key performance indicators (KPIs), narrow the gender pay gap and offer one-year paternity leave.

“I am glad to win the election, but I feel pressured when I think about my tasks,” he was quoted as saying by the Korean Financial Industry Union. “In order to prepare for the April general election, I will continue the campaign for political party affiliation with every union member.”

In addition to Park, militant union leaders are taking control of each bank union.

On Dec. 10, KEB Hana Bank's union elected Choi Ho-geol as the first head of the integrated union.

Choi has demanded an increase in vacation bonuses and the appointment of an employee director.

“With my vigorous spirit and bargaining power, I will lead our union to be competent and strong,” he said.

Against this backdrop, management has been concerned about negotiations on wage and collective agreements next year.

Management said the conflict with the union will be unavoidable if the militant leaders make unreasonable demands as profitability continues to fall.

“Bank unions had generational shifts in their latest elections,” a bank industry official said on condition of anonymity. “Given the business conditions in the banking industry will be tough next year, it will be difficult to reach agreements in wage bargaining.”