Hyundai Motor resists court ruling over employee status

By Kim Da-ye

Hyundai Motor, Korea’s largest automaker, has vowed to go as far as filing a constitutional appeal to fight a high court’s ruling that recognizes a contract worker as a regular employee.

The Seoul High Court ruled Thursday that the former contract worker, identified only as Choi, who had worked for Hyundai’s Ulsan Plant for more than two years, should be recognized as a permanent employee of the firm.

The ruling is expected to trigger uproar from the company’s contract workers, whose 25-day sit-in strike ended in early December and caused the automaker hundreds of billions of won in losses.

The case was sent back to the High Court after the Supreme Court in July last year reversed earlier court decisions and ruled in favor of Choi. This motivated Hyundai’s non-regular workers to mobilize and demand the firm to recognize all contract workers as regular employees.

“This ruling is limited to the complainant only. We cannot apply it to other workers whose working conditions and types of jobs differ from his,” Hyundai said in a statement.

Hyundai said it will challenge the Supreme Court again and also file an appeal with the Constitutional Court, indicating that the case might end up in a lengthy loop of circular lawsuits. The company insists that Choi should not be considered as a regular employee since he was hired through an agency.

Through the constitutional appeal, Hyundai also seeks to challenge the current regulations regarding the hiring of agency workers.

Choi began working at the Hyundai plant in 2002 and got sacked in 2005 for his involvement in union activities. He sued Hyundai, not the subcontractor, because he said he had become a permanent employee of the automaker in 2004.

The first two trials dismissed his claim, but the Supreme Court ruled in favor of Choi. Because it overturned the original verdict, it sent the case to the high court which again ruled in Choi’s favor.

Contentions between Hyundai and non-regular workers in both courts will have lasting impact on the entire industry once a final decision is made.

Hyundai employs about 8,200 contract workers — 22 percent of its total staff. The wholesale conversion of the workers’ status could cost the firm nearly 260 billion won in additional wages.The greater hidden cost would be losing flexibility in hiring and managing the work force while Hyundai already has a notoriously demanding labor union.

Other manufacturers also fear that Hyundai’s problem could spill over. A 2009 survey by the Ministry of Employment and Labor showed that 21.9 percent of employees at 963 workplaces that hire more than 300 people were contract workers.

Shipbuilders hire the most contract workers with 55 percent belonging to subcontractors. More than 41 percent of the workforce at large steelmakers were contract workers while they accounted for 14.5 percent at carmakers.