Hyundai Motor's union declared a "no deployment without agreement" stance on the Humanoid Robot "Atlas." It said that because the arrival of robots would inevitably cause an employment shock, this is not something management can decide unilaterally. There have already been cases where the union, citing the collective agreement, halted factory automation, and the yellow envelope law, a new labor law aimed at strengthening the bargaining rights of subcontract workers, which takes effect in Mar., also recognizes issues affecting working conditions as subjects of labor disputes, making it fully possible for the union to flex its power. However, there are concerns that a prolonged union opposition to robots could lead to weaker competitiveness in Korea's auto industry and hollowing out of production.
On the 22nd, the Hyundai Motor chapter of the Korean Metal Workers' Union said in a newsletter, "The deployment of AI robots to cut labor costs at Hyundai Motor is becoming a reality," and added, "This is a clear warning. Remember that without a labor-management agreement, not a single robot can enter the shop floor." The plan is to establish a mass-production system of 30,000 Atlas units by 2028, create a robot production base in the United States, and then gradually deploy them to manufacturing sites. Although no decision has been made on deployments at domestic plants, the union has moved early into a defensive posture.
◇ If it affects working conditions, a labor-management agreement is required based on the collective agreement
In the finished car industry and labor circles, Hyundai Motor's union warning is not seen as an empty threat. While the decision to deploy robots to the production line is a business judgment by corporations, if it affects working conditions, the union gains the authority to intervene.
Article 41, Paragraph 1 of Hyundai Motor's collective agreement states, "The company shall, upon establishing plans, notify the union and form an Employment Stability Committee to deliberate and resolve matters related to the introduction of new machinery and technology, the development and deployment of new models, improvements to work processes, transfers and retraining of personnel due to managerial or technical circumstances, and related matters." Overseas plants, including those in the United States, are not covered.
There have already been many cases in which the Hyundai Motor Group union, citing employment stability, demanded agreement from management and halted domestic plants. In 2011, when Hyundai Motor automated the production line for the new "i30" and sought to move 74 surplus workers to other plants, the union stopped production for more than a month.
Kia's electric vehicle plant in Hwaseong, Gyeonggi, which was completed in Nov. last year, spent about a year just to reach agreement with the union. EV plants have fewer parts and more automated processes, so the required workforce inevitably shrinks. To make up for this, the union demanded that annual production be raised from 100,000 units to 200,000 and that the existing workforce be guaranteed. Most of these demands were accepted.
Lee Hang-gu, a research fellow at the Korea Automotive Technology Institute, said, "In 2019, digitization of the Ulsan plant was also delayed by about a year due to union opposition," and added, "It will take time for robots to actually be introduced at domestic plants, but union backlash is a natural course, and they will take time to negotiate with management."
Even if the union does not oppose the introduction of robots, it will have no choice but to demand compensation for changes in working conditions, and if labor and management cannot align their positions, the result will ultimately be delays in introducing robots.
◇ Thanks to the yellow envelope law, disputes can begin immediately without negotiation
Skipping the negotiation phase between labor and management, Hyundai Motor's union also has a legal basis to apply the brakes directly. The vehicle is Articles 2 and 3 of the revised Trade Union and Labor Relations Adjustment Act, known as the yellow envelope law, which takes effect in Mar.
Under the revision, "business management decisions that affect working conditions" are included as subjects of labor disputes. The criterion is whether they cause substantial and concrete changes to working conditions. Because robots entering factories are highly likely to lead to redeployment of the existing workforce, labor circles believe the union is highly likely to gain the authority to strike.
Park Ji-soon, a professor at Korea University Law School, said, "The yellow envelope law will serve as grounds that Hyundai Motor's union can almost 100% use to block the introduction of robots." Park said, "Introducing robots is a kind of change in the production method that can inevitably lead to changes in working conditions such as redeployments and layoffs," and added, "Until now this was resolved through labor-management consultations, but the yellow envelope law has elevated it to a bargaining issue."
According to the "Guidelines for Interpreting the Revised Trade Union and Labor Relations Adjustment Act" released by the Ministry of Employment and Labor (MOEL) late last year, it is specified that "even if it is a business management decision, measures such as layoffs and redeployments due to restructuring, which in the process of implementing the management decision cause substantial and concrete changes in workers' status or working conditions, are subject to collective bargaining."
Kwon Hyuk, a professor at Korea University Graduate School of Labor Studies, also said, "There will be interpretive disputes over whether decisions like robot deployment are subjects of bargaining under the yellow envelope law, but conflict is inevitable," adding, "Hyundai Motor union's statement that 'not a single unit can enter without agreement' is not an empty remark."
◇ Price competitiveness will inevitably weaken… possibility of hollowing out production in Korea
Hyundai Motor is not saying it will immediately introduce robots at domestic plants, but if the introduction is not considered or is delayed due to concerns about union opposition, critics say the result will be a weakening of Korea's auto industry and export competitiveness.
Price competitiveness could slip right away. Research fellow Lee said, "China has already drastically lowered costs with robots and is competing on price," and added, "Hyundai Motor may be protecting the Korean market for now, but if cheap Chinese EVs come in, even if it remains the No. 1 player, its market share could fall." Lee also predicted it would become more difficult to compete in the global market.
Domestic workloads could ultimately decline. Park said, "Automation is in full swing not only in China but also in the United States," and forecast, "Instead of outdated plants, volumes will shift to automated overseas plants, inevitably hollowing out production in Korea."