KOREA
Why Hyundai Steel seeks to reduce workforce, despite record profitsBy Park Jae-hyuk
Posted : 2022-02-22
Hyundai Steel's steel mill in Dangjin, South Chungcheong Province, is seen
Posted : 2022-02-22
Hyundai Steel's steel mill in Dangjin, South Chungcheong Province, is seen
in this file photo. Courtesy of Hyundai Steel
Hyundai Steel CEO An Tong-il
Hyundai Steel is facing questions about its latest voluntary retirement scheme in light of the announcement of its record earnings last year, according to industry officials, Tuesday.
The steel manufacturing unit of Hyundai Motor Group decided recently to offer severance payments equivalent to three years of base wages, performance-based bonuses and additional compensation to white-collar workers aged over 53, if they apply for voluntary retirement by the end of this month. Those who have children can also receive tuition payments.
The decision was announced after the company posted 2.4 trillion won ($2 billion) in operating profit and 22.8 trillion won in sales for 2021.
Hyundai Steel carried out its first-ever voluntary retirement program three years ago in 2019, when it was suffering worsening profitability over rising iron ore prices. At that time, more than 100 senior office workers offered to resign, and the company paid out around 10 billion won in compensation.
Some industry insiders interpret the steelmaker's recent decision as part of its efforts to brace for a possible slowdown in the global steel industry, but the company denied the claim that its latest voluntary retirement scheme is intended as a workforce reduction.
"Employees can apply for retirement voluntarily," a Hyundai Steel spokesman said. "Our voluntary retirement program is intended to help our employees who want to start new careers."
He added that the number of employees to retire through the program is not fixed.
There is also speculation that Hyundai Steel's senior white-collar workers may be more reluctant to offer to resign this time, due to the ongoing COVID-19 pandemic that has made it difficult for retirees to run their own businesses with the severance payments.
Some of the steelmaker's white-collar workers criticized the company for its continuous attempts to reduce the number of senior office workers, without asking blue-collar workers to resign.
"Hyundai Steel has tended to discriminate against office employees in favor of production workers," a Hyundai Steel employee wrote on Blind, an anonymous chat app for verified employees. "White-collar workers have endured discriminatory treatment, including a wage freeze over the past few years, and now the company is offering voluntary retirement only to office workers."
Hyundai Steel CEO An Tong-il
Hyundai Steel is facing questions about its latest voluntary retirement scheme in light of the announcement of its record earnings last year, according to industry officials, Tuesday.
The steel manufacturing unit of Hyundai Motor Group decided recently to offer severance payments equivalent to three years of base wages, performance-based bonuses and additional compensation to white-collar workers aged over 53, if they apply for voluntary retirement by the end of this month. Those who have children can also receive tuition payments.
The decision was announced after the company posted 2.4 trillion won ($2 billion) in operating profit and 22.8 trillion won in sales for 2021.
Hyundai Steel carried out its first-ever voluntary retirement program three years ago in 2019, when it was suffering worsening profitability over rising iron ore prices. At that time, more than 100 senior office workers offered to resign, and the company paid out around 10 billion won in compensation.
Some industry insiders interpret the steelmaker's recent decision as part of its efforts to brace for a possible slowdown in the global steel industry, but the company denied the claim that its latest voluntary retirement scheme is intended as a workforce reduction.
"Employees can apply for retirement voluntarily," a Hyundai Steel spokesman said. "Our voluntary retirement program is intended to help our employees who want to start new careers."
He added that the number of employees to retire through the program is not fixed.
There is also speculation that Hyundai Steel's senior white-collar workers may be more reluctant to offer to resign this time, due to the ongoing COVID-19 pandemic that has made it difficult for retirees to run their own businesses with the severance payments.
Some of the steelmaker's white-collar workers criticized the company for its continuous attempts to reduce the number of senior office workers, without asking blue-collar workers to resign.
"Hyundai Steel has tended to discriminate against office employees in favor of production workers," a Hyundai Steel employee wrote on Blind, an anonymous chat app for verified employees. "White-collar workers have endured discriminatory treatment, including a wage freeze over the past few years, and now the company is offering voluntary retirement only to office workers."
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