HMM to relocate to Busan after reaching agreement with union

Minister of Oceans and Fisheries Hwang Jong-woo, left, poses with HMM CEO Choi Won-hyok, center, and labor union representatives during a press conference in Seoul, Thursday, to announce the company's relocation to Busan. Courtesy of HMM

HMM has reached a last-minute agreement with its labor union to relocate its headquarters from Seoul to Busan, easing concerns over a potential strike and clearing a key hurdle ahead of a decisive shareholders’ vote on May 8.

The company announced on Thursday that it is moving forward with the relocation after ultimately reaching a compromise.

This comes after months of stalled negotiations between management and the union since late last year, with the union filing an unfair labor‑practice complaint and requesting dispute mediation. The union has also been moving to secure the legal right to strike, describing the relocation as a politically motivated move.

“HMM’s relocation to Busan is a symbolic and hopeful message that brings us one step closer to building Busan as a maritime capital,” Minister of Oceans and Fisheries Hwang Jong-woo said during a press conference for the announcement in Seoul.

“The creation of a marine cluster and fostering a maritime capital region will provide a foundation for new regional growth engines and a solid base for Korea’s balanced, sustainable development.”

Under the agreement, HMM plans to seek shareholder approval at the upcoming meeting to amend its articles of incorporation, formally changing the location of the company’s head office. It aims to complete the legal registration of the new Busan headquarters by the end of May.

The company has also pledged to invest in Busan, saying it will build a landmark office tower in the city’s North Port redevelopment area.

The company intends to move the CEO’s office first, and will then decide the scale and timing of the broader move through further talks with the union. Some functions, such as sales and finance, may stay in the Seoul area as branch operations.

HMM CEO Choi Won-hyok explained that the conflict in the Middle East led management and labor to settle on a deal on the brink of a strike.

“The conflict has driven almost all global shipping lines deeper into the red … HMM alone has around 20 tankers operating, so if (labor-related) issues do not properly settle, Korea’s broader industrial activity could have been paralyzed,” he said.

“(The management and labor) held intensive talks over the winter and early this year, running multiple scenarios and ultimately opting for a big‑picture decision.”

He added that the company is working with the Busan city government and relevant government ministries for support measures for its employees regarding the relocation and plans to discuss them through a joint consultative body.

Despite the agreement, the union still expressed concerns about how workers would be compensated for the move.

“Now that the headquarters relocation has been decided, what matters most is putting in place concrete countermeasures … In the upcoming detailed talks, dialogue between labor and management must be more sincere and genuine than ever before,” a union representative said.

“There must be sufficient and practical compensation measures that workers can accept for housing, education conditions, and the tangible and intangible losses arising from the relocation process.”