ed Dismissed workers' tears

When President Park Geun-hye visited India last month, she asked the chairman of Mahindra-Mahindra, an automotive group that owns Korea’s Ssangyong Motor, to make efforts to rehire employees laid off in 2009. The episode reflected how the dismissed workers of Ssangyong have become a serious social issue in Korea.

Since the nation’s smallest carmaker laid off 2,600 employees, or one third of its workforce, as part of its corporate restructuring five years ago, 24 workers or their family members have killed themselves or died of stress-related diseases. Many more families broke apart.

So a Seoul appellate court’s ruling Friday to nullify the dismissal and order Ssangyong to reinstate 153 former employees who filed suits came as a pleasant surprise even for the dubious workers themselves.

Unlike a lower court, the high court saw through the grossly manipulated accounting books ― although it did not say so explicitly ― which exaggerated financial difficulties and downplayed its potential for recovery, all with the aim of justifying the mass layoff. The appeals court also concluded, correctly, that Ssangyong failed to do all it could to avoid the dismissal.

The latest ruling should serve as a stern warning for managers who think of layoffs as the first, and easiest, step to get out of temporary financial crunches instead of using it as a last resort. Manpower trimming has become rampant, especially since the 1997-98 Asian financial crisis, as employers sack about 80,000 workers on average a year in the name of restructuring. The moves throw many breadwinners into extreme hardship in this country of mostly single-income families, and narrow and loosen social safety nets, as shown by the Ssangyong workers’ tragedy.

Ssangyong says it will appeal to the Supreme Court, stressing the layoff was according to a restructuring plan approved under court receivership.

The company is advised not to. A self-help plan by a company in financial crisis is usually designed to satisfy its creditors’ need to the maximum under the insolvency act, but hardly justifies massive layoffs. Ssangyong ought to accept the high court’s decision and peacefully settle the case, not aggravating the dispute further, in respect of the accord in the Park-Mahindra meeting.

In a way, the nation’s fifth-largest automaker was the victim of a hasty corporate selloff to foreign investors in the wake of the currency crisis in the late 1990s. Had the then owner of Ssangyong, Shanghai Automotive, tried harder to keep it afloat, instead of hurriedly withdrawing after acquiring key technology knowhow, the company’s fate would have been far different from what it is now.

The political circles should hasten to revise laws to toughen conditions for dismissal ― which currently are second easiest among OECD countries ― at least until Korea comes up with far larger and tighter social safety nets. The ruling Saenuri Party in particular, which reneged on campaign promises to conduct parliament probes into the Ssangyong case, must actively seek the legal revision.

President Park used to preach the government’s role is to wipe the tears of the weak and poor. The governing party should practice that.