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Prosecutors on Tuesday sought an arrest warrant for the former head of Hyundai Motor labor union. He allegedly received 200 million won from a high-ranking company official back in 2003 in exchange for his help in getting unionized workers to end a strike and smooth negotiations. Hushed rumors of illicit backroom dealings have finally surfaced.
At the time, as they had done practically every year, the union staged a 25-day strike over the wage negotiations, leading to 1.3 trillion won in lost production. The union leader back then was leading workers to join him in the struggle for better conditions, while at the same time receiving money behind closed doors. It was as if the strike was a clever business deal. That method is no different than street thugs demanding protection money from merchants. In 2005, twenty high-ranking Hyundai Motor union officials were prosecuted for receiving up to 400 million won from job seekers in exchange for recommendations. Last year, a high-ranking union official was arrested for taking bribes from producers of souvenirs to mark the anniversary of the union. Why would people who¡¯ve made a business out of hiring and souvenirs turn down an opportunity to profit from a strike?
The company is just as much to blame for the corruption of the labor union. Even though strikes were leading to snowballing losses, attempting to buy off the union head just creates more trouble. Hyundai Motor has went out of its way to please its union leaders, giving them up to W900,000 (US$1=W935) in extra monthly pay and providing them with personal cars with gasoline paid by the company.
The reason why Hyundai has seen only one year without strikes over the last 20 years, is because they¡¯ve spoiled their labor union. While shouting ¡°no work, no pay,¡± every time the strike ended, the company was busy showering them with bonuses and bribes. After every strike, the company elevated the status of union leaders. No wonder they ended up believing that strikes would always lead to their own profits.
Hyundai is saying that this time, they will not cave in to the unreasonable demands of the union. If Hyundai breaks that principle again, then that could very well spell the end of Hyundai Motor.
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