South Korea: Oriental Brewery fearing workers’ strike over wage increase negotiations

Oriental Brewery (OB) is struggling to complete wage negotiations as union workers demand more than what management is willing to offer, company officials said on August 3, Korea Times reports.

It is feared that the workers may go on strike if the talks continue to drag on, which would adversely affect the brewer's operations and tarnish its image.

Korea's largest brewer, which accounts for more than 50 percent of the beer market, is having a hard time concluding wage talks with union members who demand an 8 percent hike in base salary. But management is willing to increase the salary by 2.5 percent.

Unionized workers already voted in favor of a strike and since July 27, they have been staging a series of partial strikes at OB's three plants to put more pressure on management to accept their demands. But they have remained cautious about staging a full-scale walkout.

The brewer runs production lines in Icheon, Gyeonggi Province, Cheongju, North Chungcheong Province, and Gwangju, employing about 2,000 people. Nearly 1,200 are union members.

In August the previous year, OB employees stopped working for 10 days, bringing the firm's three plants to a complete halt.

This first full-blown strike, since April 2014 when AB InBev acquired OB for $5.8 billion, was said to have benefited Hite-Jinro, Lotte Chilsung and other brewers when beer demand reaches the highest in the summer.

The union returned to work after management agreed to raise the base salary by 3.5 percent.

"Both management and the union have been engaged in intense talks over the past few months. But they haven't been able to reach a consensus on the wage hike," a company official said. "It won't be easy to narrow the differences, given the union's demands. But nonetheless, we will continue to work to bring unionized workers to their senses."

OB will take all possible measures to avert any possible disruption to its production and will meet demand for beer during the peak summer season, the official said. "Management will continue to engage with union leaders in a sincere manner and reach an agreement as quickly as possible."

The labor-management relationship has deteriorated since AB InBev took over OB in 2014 as many workers complained about a series of changes that have taken place.

Union officials have said employees have to work longer hours for the same paycheck, adding that some, particularly in sales and marketing, are struggling to adapt to the drastically changed office culture and work processes.

They are required to write company documents in English and work with foreign managers dispatched from AB InBev.

03 August, 2017