What caused Kia union to turn docile?

By Kim Tae-gyu

Earlier this September, Korea’s second-largest carmaker Kia Motors came up with a press release with great fanfare that its militant trade union opted not to go on strike for the first time in two decades.

The news surprised many watchers because they were expected to wrangle over the thorny issue of the so-called ``time-off’’ system under which the firm is required to reduce support for full-time paid unionists.

A month later, Kia workers struck observers once again through deciding to cover the diminished company aids by raising their monthly union dues by 14,200 won on top of existing provisions amounting to 1.2 percent of their salaries.

As unprecedented events took place twice in a row at the Seoul-headquartered outfit, some present an explanation of trying to locate a clandestine link between the back-to-back rare occurrences.

``Over the negotiations in the summer, Kia offered a special allowance of 15,000 won per month in addition to the salary raise. Doubts run high that the amount is actually for making up for the reduced support for union,’’ a Seoul analyst said.

``The formula is like this. The firm cuts down financial backing for union leaders but give some special grants to workers, who toss 95 percent of them to the union. The result: the union will get almost the same amount of money in return for not walking out.’’

The analyst added that if the suspicions are true, the maneuver is designed for three-way win-win solutions ― the management will be happy with not seeing strikes and union leaders will be content with almost same size of cash flows. From the perspective of ordinary workers, they just need to transfer unexpected increments to the union.

Yet, there are losers. Shareholders would see less dividends or see less future profits since the money used to ``buy the union leaders’’ would end up chopping investment or payout, according to the analyst.

Whether or not the doubts are true, Kia’s union will be able to maintain 91 full-time paid unionists although the company has trimmed support to just 21 under the time-off policy, which went into effect in July.

The fresh system materialized under the revised Labor Act geared toward slashing the number of full-time paid union members and has worked for many companies with some exceptions such as Kia.

When contacted, both the company and the labor union flatly denied such suspicions, while labeling them as a groundless conspiracy theory.

``The misunderstanding seems to have sprouted because the amount of the special allowance and that for the heightened union dues are almost the same. But they have nothing to do with each other,’’ a company representative said.

``We pay the extra allowance when Kia workers’ salary raises are less than those for sister company Hyundai Motor’s employees. That was the case for this year and we paid similar compensation back in 2008.’’

The union was adamant in lashing out at the ``allegations.’’

Yet, a Kia insider said that the union asked workers to endorse the no-walkout idea early September on condition that they will pay increased union dues tantamount to the special allowances.

In other words, the union tried to encourage its members to transfer the allowances for the hike of union provisions a month ago in order to keep the size of its full-time staff intact.

``The way how things have gone on seemingly makes some believe the possible collusion between management and labor. But complaints are hardly heard because nobody is losing at this company, workers nor employers,’’ the insider said.