SEOUL - Wage negotiations between union and management at South Korea's top automaker, Hyundai Motor Co., collapsed on Friday and unionized workers will soon vote on whether to strike, a union official said.
Industrial unrest frequently has a direct impact on South Korea's economy by hampering operations of major industries such as cars, chemicals and distribution. It is also regarded as a key deterrent for foreign investors thinking of doing business in the country.
"Given that management has not shown a sincere attitude, we think that having more talks is meaningless," said a union official.
"We will report our labor dispute to the Labor Ministry on June 14 and will then have a 10-day cooling off period before unionized workers vote on a strike," he added.
Workers belonging to Hyundai's 40,000-strong union have demanded a 10.48 percent increase in basic annual salary, as well as their share of a bonus payout equivalent to 30 percent of the company's net profit.
Hyundai Motor has about 51,000 local employees.
The union is one of the most powerful members of the umbrella labor group the Korean Confederation of Trade Unions (KCTU), which is campaigning for better treatment of part-time workers.
"Negotiations are expected to resume during the cooling off period," said a Hyundai Motor official who declined to be named. "The company is going through a tough period and will take some time to come up with its own proposal."
Workers at Hyundai affiliate, Kia Motors Corp., as well as their counterparts at SUV maker, Ssangyong Motor, and unlisted GM Daewoo Automotive Technology, were also planning similar industrial action over pay, officials at the companies said.