As the launch of the bridge insurance company for the restructuring of MG Non-Life Insurance approaches, the Korea Deposit Insurance Corporation (KDIC) and the union of MG Non-Life Insurance are narrowing the differences in their opinions regarding the employment succession rate. The KDIC aims to accommodate the employment succession rate level of 57% demanded by the union as much as possible while continuing negotiations that involve lowering existing wages. Discussions are also underway regarding the provision of job support funds for employees who are not hired.
According to the industry on the 30th, the KDIC and the MG Non-Life Insurance union are continuing discussions to hire between 200 and 300 MG Non-Life Insurance employees for the bridge insurance company, 'Yebyeol Non-Life Insurance,' through 11 rounds of negotiations that have taken place recently. The employment succession rate is expected to be between 50% and 55%. As of April, the total number of employees at MG Non-Life Insurance was 521.
Before engaging in formal negotiations with the KDIC, the union initially demanded an employment succession rate of 65% (340 people). During the negotiations, the union proposed 57%, while the KDIC suggested 38% (200 people). The employment succession is expected to be distributed evenly, regardless of the department to which the employees belonged while working at MG Non-Life Insurance.
Both parties are also negotiating a plan to reduce the wages of the MG Non-Life Insurance employees transferring to Yebyeol Non-Life Insurance by a certain level. This is based on the judgment that labor costs need to be cut for a quick sale.
Both parties are discussing a proposal to provide job support funds to the un-hired MG Non-Life Insurance employees. The size and method of payment for the job support funds are expected to be discussed in the 12th negotiation taking place on this day. The KDIC plans to launch Yebyeol Non-Life Insurance as soon as the negotiations are completed.
A KDIC official noted, "This negotiation proposal was made in the aspect of sharing the pain," adding, "The union is also taking an active role, making the discussions proceed smoothly." A union official stated, "We are coordinating the details, but we agree on the company's streamlining for the sale."
In May, financial authorities announced that they would proceed with the transfer of MG Non-Life Insurance contracts to the top five non-life insurers (Samsung Fire & Marine Insurance, Meritz Fire & Marine Insurance, DB Insurance, KB Insurance, and Hyundai Marine & Fire Insurance) through bridge insurance companies. This decision was due to the financially troubled MG Non-Life Insurance's inability to maintain existing contracts normally. Financial authorities are also pushing for the resale of MG Non-Life Insurance alongside the transfer.