Union worried Cruze resourcing beginning of downsizing move

Union worried Cruze re-sourcing beginning of downsizing move.

GM Korea’s Union Fumes Over High-Level Talks

GM CEO Dan Akerson’s interest in a dialogue with Korean President Geun-hye Park shocked union officials, who say the two sides had just begun negotiations on a new 2013-2014 collective bargaining agreement and were looking forward to productive discussions.

General Motors CEO Dan Akerson has caught the ire of union leaders in Korea, who believe the executive is actively lobbying Korea President Park Geun-hye for sympathy and support during the auto maker’s ongoing labor negotiations in that country.

A spokesman for the GM Korea branch of the Korea Metal Workers Union is fuming because Akerson told the union’s president at a meeting in the U.S. last week that he planned to discuss the labor situation with Park, who is in the U.S. for a summit meeting with President Obama and to address a joint meeting of Congress.

The KMWU branch president earlier met with Akerson in the U.S. to seek assurances GM would not pull operations out of Korea, a union source says.

Akerson said last month GM might shift sourcing due to concerns over North Korean threats of nuclear attacks on South Korea and American holdings in the region.

Akerson reportedly assured the union GM won’t pull operations out of Korea but voiced concerns about the tough labor situation and said he was planning to take the issue up with Park.

“We are offended by his remarks,” says union spokesman Choi Jong-hak. “We did not travel all the way to the United States to hear something like that.”

Akerson’s interest in a dialogue with Park shocked union officials, who say the two sides had just begun negotiations on a new 2013-2014 collective bargaining agreement and were looking forward to productive discussions.

Korean government officials have not confirmed a meeting, but industry sources say GM had arranged a one-on-one between Akerson and Park.

“We see this as a tactic to put pressure on our negotiators during the critical sessions that have just started,” a union source says.

GM Korea declines comment on the matter.

There are many hot topics on the table during this year’s GM Korea bargaining sessions, observers say.

Among them is the switch to a 2-shift production system scheduled to launch in January. Discussions about how to pay workers under the new arrangement, particularly for weekends, holidays and overtime, are ongoing and thorny.

Employees at Hyundai and Kia, where a similar 2-shift system has been implemented, have refused to work weekends since March 9 in a dispute over pay.

Hyundai reached an accord with its union on the weekend pay scale early last week, but rank-and-file members turned down the deal.

Hyundai workers say they want both a Sunday holiday premium as well as the former weekend-night premium to be paid for the new weekend day and afternoon shifts, even though night work has been eliminated.

GM Korea also is faced with pending lawsuits from workers, as are Hyundai and Kia.

Employees are suing to have annual bonuses assessed as part of their regular pay. They want the bonuses figured in and the total amount used as the basis for calculating overtime rates.

Collectively, if the workers win, it could cost the three auto makers several billion dollars in back overtime pay, analysts note.

The GM Korea union also is concerned about the move to shift production of the Chevrolet Cruze out of the Gunsan plant. No replacement vehicle has been named to fill the gap, and the union fears GM Korea is planning to downsize to improve profitability.

Further, many workers are balking at GM Korea plans to increase line speeds to compensate for shorter working hours under the upcoming 2-shift system.

Park met with President Obama on Tuesday and later was scheduled to meet with Akerson and other American and Korean business leaders, including Hyundai Group Chairman Chung Mong-koo.

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