HMM, which moved its head office location to Busan, will pay encouragement money to its land-based employees. Labor-management conflict intensified to the brink of a strike over the head office transfer, but the company said it is because no strike took place after an agreement was reached.
According to the shipping industry on the 11th, HMM recently notified land-based employees that it will pay 4.5 million won per person as encouragement money under the labor-management agreement. The payment is scheduled for this week. It comes about 10 days after a labor-management agreement on the head office transfer was reached on the 30th.
HMM employees are divided into seagoing positions that include crew and land-based positions responsible for sales, operations support, strategic finance, and management support. As of the end of last year, land-based employees accounted for 56% (1,043 people) of all staff.
Most land-based employees, who work at the head office in Yeouido-dong, Yeongdeungpo-gu, Seoul, strongly opposed the policy to transfer the head office to Busan. It was the land-based labor union that filed criminal and civil complaints against the CEO, held a rally, and warned of a general strike.
They argued the company's push for the head office transfer was unilateral and applied for mediation with the Labor Relations Commission, taking steps to secure the right to strike. If no agreement had been reached with the company side at the second mediation meeting scheduled for the 30th, they planned to launch a general strike.
However, on the 24th of the same month, they withdrew the strike after accepting the company's proposal that "after the change of location, the scale and timing of the organization transfer will proceed through labor-management agreement." In a union vote on the agreement at the time, about 90% approved it.
There were opinions then that the head office location transfer should be opposed, but more weight was given to the view that if a strike occurred, the operation of all company vessels would become impossible, inevitably causing damage that would be difficult to recover from, such as a collapse of shippers' trust and threats to maintaining shipping alliances.
In line with the labor-management agreement, HMM changed the head office location, defined in the articles of incorporation as Seoul, to Busan at an extraordinary shareholders meeting held on the 8th. Within this month, it plans to complete address changes on the corporate registry and business registration certificate and to transfer the CEO's office.
However, as the overall scale and timing of the transfer will be decided later through labor-management agreement, that issue is expected to be the key going forward. SK Shipping and H-Line Shipping, which moved their head offices to Busan before HMM, are also known to have transferred only some land-based employees.
An HMM official said, "We are paying encouragement money because land-based employees who opposed the transfer to Busan reached a labor-management agreement and did not go on strike."