Daewoo Shipbuilding & Marine Engineering’s subcontracted workers and the shipbuilder’s management reached a last-minute compromise on 22 July to end a 51-day strike.
The workers have agreed to DSME’s management’s proposed 4.5% wage increment and additional special allowances. South Korea’s second-largest shipbuilder has also agreed to partially employ workers from subcontracted firms that went out of business due to the strike.
The resolution came just before the workers were due to go for a two-week summer break and averted the use of police force to break up the strike. The previous week, president Yoon Suk-yeol had declared that the strike was illegal and that the government would not hesitate to use force to end the industrial action.
While 96% of the unionised workers ratified the agreement, DSME’s management is persisting in its legal action against the militant workers. Both sides are expected to continue negotiations to resolve the lawsuit.
DSME estimates that it has lost at least US$600 million due to delays in newbuilding deliveries, as the workers had occupied three tankers under construction in its yard in Geoje. This caused DSME to go into emergency management mode, in anticipation of financial pressures caused by rising raw material costs and the cancellation of LNG carrier orders meant for the Arctic LNG project due to sanctions against Russia.
The Korea Metal Workers’ Union, which represents shipyard workers, has criticised the lawsuit as retaliation against the workers who are not well-off, even as DSME said it is seeking compensation for the losses it suffered.
The government is urging DSME’s management and labour union to work together to resume normal shipyard operations.
Meanwhile, nine KMWU workers could still face criminal proceedings, as the police have issued arrest warrants for them.
Martina Li
Asia Correspondent
