Hyundai Motor union to hold four-day partial strike amid chairman's arrest

The union of South Korea's biggest automaker, Hyundai Motor Co., will stage a four-day partial strike starting Monday afternoon over wages amid the company chairman's detention over bribery and embezzlement allegations.

The industrial action is the latest blow against the automaker since Chairman Chung Mong-koo's arrest on April 28. Chung is on trial on charges of misusing 400 billion won (US$420 million) of company money and embezzling 120 billion won to raise slush funds to bribe government officials.

"We will strike for two hours a day from June 26 to June 29," the union said on its Web site. The partial strike was set to begin at 2 p.m. at its plant in Ulsan, 414 kilometers south of Seoul.

"Future actions would depend on whether the management is negotiating with us with a sincere attitude," said Kim Won-keun, a union official. Kim said the union will hold a meeting on Thursday to decide about next steps.

As of 10:15 a.m., shares of Hyundai Motor fell 1.5 percent to 76,000 won in Seoul, compared with a 1.12 percent rise in the broader market index.

Among the 39,903 unionized workers who voted on Friday, 80.3

percent supported the strike action, the Web site said. Hyundai Motor's 44,000-member union is demanding a 9.1 percent rise in basic salary and an unspecified increase in bonus payments, among other requests.

The union and management have been in talks since May 9, but the negotiations collapsed when the management refused to accept the union's demands, citing worsening business conditions, the union said. A strike by Hyundai Motor's union, which is often known for its militancy in labor disputes, has been an annual rite.

Monday's action would be the 12th consecutive year of strikes since 1995 at Hyundai Motor, which aims to become one of top five automakers in the world by 2010. Analysts say poor labor relationships are one of major obstacles for Hyundai Motor to achieve the ambitious target. Together with its affiliate Kia Motors Corp., Hyundai Motor is the world's seventh-largest automaker.

In order to avoid a labor dispute at home, Hyundai Motor is stepping up efforts to move its production lines overseas. The automaker is now running plants in the United States, India and China, among other countries.

Hyundai Motor's overseas expansion plans are also one of major issues in the annual strike actions by the unionized workers, who fear losing their jobs.

However, the automaker's plans to build more overseas plans have been disrupted by a management vacuum after Chung's arrest.

Last month, Hyundai Motor indefinitely delayed the start of construction on a $1 billion plant in the Czech Republic, and Kia Motors followed suit by postponing a similar project in the United States.

On June 15, the 68-year-old Chung, who is considered a micro-manager, privately apologized for causing the slush fund scandal in a letter to the judge who is weighing his fate in the trial.

"I wholeheartedly apologize for raising and using slush funds," Chung was quoted as saying in the one-and-a-half page letter.

"Admitting my overall responsibility in the slush funds...I

will learn a lesson that will never be forgotten for the rest of my life," the chairman said.

Chung faces a third trial on Monday, the same day as the strike.

Under South Korean criminal law, Chung could face a sentence of life in jail for corporate embezzlement of more than 5 billion won.

However, local newspapers have reported that Chung may receive leniency because of his role in the national economy. Seoul, June 26 (Yonhap)