By Lee Hyo-sik
Kumho Tire said Monday that management and union leaders reached a tentative agreement over wage hikes, nine months after both sides began negotiations.
Company executives and union leaders, who resumed talks on Feb. 12, reached an accord under which Korea’s second-largest tire maker will increase the base salary by 4.6 percent, and pay a 3 million won bonus. In addition, management and labor decided to introduce a peak wage system in 2017.
Both sides also issued a joint statement, pledging to boost labor productivity and create a more constructive and cooperative labor-management relationship.
“It’s been a tough process for both labor and management to come to the latest consensus,” a Kumho Tire spokesman said. “We would like to wrap up the wage negotiation as soon as possible to work together to restore our efficiency and normalize operations.”
The spokesman said labor and management will form an ad-hoc committee to discuss the details of the upcoming peak wage system.
Unionized workers staged a strike for 39 days last summer, dealing a severe blow to the company which just graduated from the creditor-managed workout program. On Dec. 17, the union staged a partial strike for two hours and had threatened to do the same indefinitely from Feb. 15 unless company management accepts its demand.
Hit by labor unrest and the slowing Chinese market, Kumho Tire suffered an 11.6 percent sales drop to 3.04 trillion won in 2015 from the previous year. Its operating profit tumbled 58.1 percent to 150 billion won. The company also posted a 28.7 billion won net loss.