SEOUL -- Hyundai Motor Co. reached a tentative wage pact with its South Korean labor union today after the worst strikes in the automaker's history disrupted output at its domestic production base.
The agreement is subject to a vote by almost 50,000 union members on Thursday, who rejected an earlier deal in August because of it was less generous than the previous year's package.
The union has held 24 rounds of full-scale or partial strikes since July 19, preventing the automaker from making 131,851 vehicles worth more than 2.9 trillion won ($2.6 billion), the government said last week.
"The company and the union have formed a common ground that we should prevent further catastrophe as a prolonged strike has had a substantial impact on not only the company but the regional and national economy," Hyundai said in a statement.
Under the latest agreement, Hyundai will increase basic monthly pay by 72,000 won ($64); give each worker a one-off payment of 3.3 million won as well as bonus and incentives payments worth 3.5 times their basic monthly wage; and each worker will also receive 10 Hyundai shares, the company said.
The deal came after the government threatened to intervene to suspend strike action, criticizing the union for walkouts despite relatively high wages at the automaker.
The prolonged labor disputes coupled with sluggish domestic demand have prompted some analysts to cut earnings forecasts for the July to September quarter which the company is scheduled to report late this month.
Hyundai, which is the world's fifth-biggest carmaker including affiliate Kia Motors, has been hit by strikes in all but four of the union's 29-year history though it usually made up for lost production by the end of each year.