Hyundai Motor begins wage talks as union seeks 30% profit-sharing bonus

(Hyundai Motor)

Hyundai Motor and its labor union began annual wage and collective bargaining negotiations Wednesday, with the union demanding expanded performance-based bonuses and stronger job security protections in the artificial intelligence era.

Management and union representatives held their first formal meeting at Hyundai Motor’s Ulsan plant to discuss the direction and schedule of this year’s negotiations. More than 60 representatives attended, including Hyundai Motor Chief Executive Choi Young-il and union officials from the Korean Metal Workers’ Union.

The union has requested a 149,600 won ($103) increase in monthly base pay and performance bonuses equivalent to 30 percent of the company’s net profit from last year.

It also called for guarantees on employment and working conditions related to AI adoption, a fully fixed monthly salary system, an 800 percent increase in bonuses, an extension of the retirement age and additional hiring.

This year’s negotiations began amid heightened tensions following controversy over large performance bonuses paid in the semiconductor industry after strong earnings results. Industry observers said employee expectations for compensation have risen sharply, likely leading to tough negotiations over wages and bonus structures.

The implementation of the so-called “yellow envelope law,” which strengthens labor protections, is also expected to complicate negotiations.

An industry official said this year’s talks could prove more difficult than usual as issues such as shorter working hours and job security are being discussed alongside wage increases.

Hyundai Motor and its union have typically continued negotiations for around two months, though this year’s talks started relatively early. Some analysts said that could raise the possibility of an early agreement, while others cautioned that major differences in demands may make negotiations difficult.

Union dissatisfaction over compensation and workload has reportedly accumulated internally, making the company’s proposed compensation package a key factor in the outcome of negotiations.

Last year’s wage agreement was reached only after the union staged three partial strikes.