The trade union at Daewoo Shipbuilding & Marine Engineering (DSME) proposed discussion of the ‘pain-sharing’ agenda, including wage reductions, through a conservative group composed of labor and management at DSME, the government, and creditors.
The union explained that “management recently asked us to accept a 10% reduction in wages. The union acknowledges that this reduction request is reasonable based on the current circumstances.”
Nevertheless, the union affirmed its position against possible ‘pain-bearing only by the union,’ and stated that “if management attempts compulsory wage reductions etc. to meet the demands of creditors, the union will have no choice (but to strike).”
The trade union also stated that it is aware of public criticism of using tax money to rescue DSME, and notes that the criticism is reasonable in terms of economic democracy. However, the union explained the difficulty in accepting another 10% wage reduction since “many workers have already left the company and the remaining workers are at wage and benefit levels which equal to those of 10 years ago.”
On 23 March 2017, the government decided to invest an additional KRW 2.9 trillion (USD 2.61 billion) in DSME. The creditors, including the government, the Korea Export-Import Bank and the Korea Development Bank, asked for another ‘pain-sharing’ by workers at DSME in return for the investment.