The union representing Kia Corp (000270. KS) in South Korea said it would put off its earlier Wednesday scheduled partial walkout to continue its discussions with the business. For the past three months, negotiations between the union and Kia’s management have focused on compensation hikes and raising the retirement age.
Before discussions collapsed, the union announced it would restrict working hours for six working days starting on October 12. This would have been the first industrial action at Kia in three years.
An official with the Kia union told Reuters, “We have decided to postpone the scheduled strike for tomorrow since we are holding conversations with the management. The union will take the next move following talks with the firm.
Kia refuses to respond to questions about the strike. The Kia union is asking for a 4-day work week, an increase in the retirement age from 60 to 64, a performance pay equal to 30% of Kia’s 2022 net profit, and a minimum basic monthly salary rise of 184,900 won ($138.12).
With more than 26,600 members, South Korea’s second-largest carmaker union said last month that 92.3% of its members had endorsed going on strike if the management did not meet their demands.
The labor action at Kia comes as the affiliate union at Hyundai Motor Co (005380. KS) avoided going on strike last month after the union and management agreed to increase yearly salary by approximately 12%.
Analysts predicted that Kia’s unions would avoid any significant industrial action because the agreements with Hyundai Motor and its partner Hyundai Mobis (012330. K S) were reached without the use of any industrial action.
According to a Eugene Investment & Securities analyst, Lee Jae-il, “Kia is currently the only one that plans to actually go on a strike… this is unlikely to give much momentum for Kia to carry intense strikes or go on for too long by itself.”
Kia Corp. shares ended the day up 0.5%, compared to a 2% increase in the benchmark KOSPI (.KS11).
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