The IBK Industrial Bank of Korea labor union conducted a general strike demanding special bonuses, and conflicts are growing over the payment scale of bonuses at other commercial banks as well. With financial holding companies expected to achieve 'record-high performance,' interest in the scale of bonus payments in the financial sector is increasing. However, forecasts suggest that a 'bonus party' is unlikely due to worsening public opinion regarding the banking industry.
According to the financial sector on the 30th, the Korea Federation of Banks union is experiencing difficulties in reaching an agreement on this year's wage collective bargaining and initiated a tent demonstration on the 26th. The union is reported to have demanded a 300% bonus payment and a special incentive payment of 10 million won.
Last year, KB Kookmin Bank agreed to a bonus level of 230% of the regular salary during the wage collective bargaining negotiations. The management is said to have expressed reluctance toward the level demanded by the union this year, citing a lack of funding.
On the 27th, over 4,200 members of the Industrial Bank of Korea participated in the first solo general strike. The union has announced plans for a second and third general strike if there continues to be no progress. The Industrial Bank of Korea labor union demands a 250% special bonus payment, cash compensation for accumulated vacation time, and an increase in the employee stock ownership plan amount. Additionally, they are calling for the resolution of 'discriminatory wages,' stating they are receiving 30% less in wages than other commercial banks.
The NH NongHyup labor union, composed of employees from the National Agricultural Cooperative Federation, NH NongHyup Financial Group, and NH NongHyup Bank, also held a rally on the 26th concerning the scale of special bonus payments. The union argued that a special bonus equivalent to 100% of the basic salary should be paid, but management is reported to have only proposed a 50% payment plan.
While negotiations for wage collective agreements are actively underway among the banking sector, it does not seem easy to find a compromise. The banking sector has reduced bonus levels from 300% of the basic salary in 2022 to 200% last year, in awareness of criticisms regarding 'interest profit sharing' and considering the government and public opinion. This has led to increasing demands for another increase this year.
Moreover, this year, banks are expected to achieve record-high results due to the widening interest margin between deposits and loan rates, and the unions' demands appear to be intensifying. According to financial information provider FnGuide, the projected annual net profit for the four major financial holding companies (KB Kookmin, Shinhan, Hana, and Woori) is a total of 16.9245 trillion won, surpassing the record-high results of 15.6503 trillion won obtained in the high-interest environment of 2022.
However, despite the unions' demands, forecasts suggest that it will be difficult for banks to pay bonuses exceeding 300% of the basic salary again. Observations indicate that domestic demand may further weaken due to factors such as martial law, impeachment, and passenger plane disasters, leading to a situation where the banking sector cannot help but be conscious of criticism regarding the 'bonus party.' Some opinions suggest that the increase in bonuses may be accompanied by an increase in welfare benefits, as Shinhan Bank management and unions have agreed to pay 280% of the basic salary as a bonus while also expanding vacation time and increasing My Shinhan points.
A source from a commercial bank stated, 'Negotiations are still ongoing, so it's difficult to confirm specific details, but there are many rumors circulating internally regarding bonuses,' and noted, 'The prevailing opinion is that this year may not be significantly different from last year.'