Hanjin Group Chairman Cho Won-tae said the integrated carrier will adopt Korean Air Lines as the standard for organizational operations, including personnel policies and rank structures, after the merger of Korean Air Lines and Asiana Airlines.
Korean Air Lines is proceeding with procedures to merge with Asiana Airlines by the end of this year. It is seen as an effort to minimize operational confusion after the merger and quickly create integration synergies.
However, the industry expects that if Korean Air Lines is used as the operating standard, salaries and other compensation for Asiana Airlines personnel will rise, potentially expanding the company's expense burden.
According to the aviation industry on the 27th, Cho recently held a town hall meeting with employees at Korean Air Lines' headquarters in Gangseo District, Seoul, and said, "After the merger, the standard for organizational operations will be arranged around Korean Air Lines."
It means all operating standards, including rank systems by job category, welfare, and pay at the integrated airline, will be set in the way Korean Air Lines has done. For Asiana Airlines employees, several things will change.
Korean Air Lines is said to have drawn up a plan to ensure that Asiana Airlines employees do not suffer disadvantages in the process of being incorporated into Korean Air Lines' operating system.
However, various burdens on Korean Air Lines are expected to increase compared with before the merger. The burden of salaries and welfare will grow immediately.
As of last year, the average salary per employee at Korean Air Lines was 123 million won, and with 16,852 employees, the company spent a total of 2.1744 trillion won on salaries last year.
During the same period, the average salary of Asiana Airlines employees was 92.62 million won, and with 7,075 employees, the company spent a total of 660.5 billion won on salaries.
Even considering that the average length of service at Korean Air Lines is about two years longer, the roughly 32% pay gap with Asiana Airlines suggests that labor costs will rise significantly first.
Various welfare burdens are also expected to increase. Korean Air Lines' welfare expenditure was 171.7 billion won last year, while Asiana Airlines' was 63.1 billion won. Even accounting for the number of employees, Korean Air Lines' expenditure scale is about 14% higher than Asiana Airlines'.
Unlike Asiana Airlines, Korean Air Lines operates programs to support home purchase funds and jeonse deposits, and provides broader scholarships and childcare support, including childcare expenses for children and special education expenses for children with disabilities.
However, even if Korean Air Lines is the operating standard, numerous detailed tasks remain to be resolved, such as the seniority system (hierarchical culture system) for flight and cabin crews.
On the 23rd, the Korean Air Lines pilots' union declared a breakdown in negotiations, saying management is insisting on excluding the seniority system from the bargaining agenda after the merger.
They are holding a relay one-person protest with placards reading "Who is this merger for," "A company that ignores its own employees and only cares about the neighbors' employees," and "Too bitter to live."
Through the town hall meeting, Cho also mentioned, in addition to integrating operating standards, uniforms, organizational culture, integration keywords, fleet introduction plans, and the adoption of artificial intelligence.
On uniforms, he said it is difficult at this time to find a design better than the current one, so for now, reflecting on-site feedback, functionally improved Korean Air Lines uniforms will be used.
Regarding organizational culture, he said the organization should move away from the existing vertical culture and become one that communicates more freely with employees, and stressed that through this, even after the merger, the airline must be reborn as one trusted by customers.