Hanjin chief grilled over layoffs

By Lee Tae-hoon

Lawmakers of both the ruling and opposition parties Thursday blasted Cho Nam-ho, chairman of Hanjin Heavy Industries and Construction (HHIC), over the massive layoffs of Hanjin workers.

They unanimously blamed Cho for his failure to look after the interests of his employees in a parliamentary public hearing.

Rep. Chang Je-won of the governing Grand National Party (GNP) raised the question of whether HHIC had encountered a crisis serious enough to conduct the layoffs.

“HHIC’s net profits between 2001 and 2009 reached 420 billion won ($391 million) and the company’s profit margin for its shipbuilding works stood at 13.7 percent last year,” he said.

“I don’t believe the company had to fire 1,300 workers in the past two years under the pretext that the company’s future was in jeopardy.”

The lawmaker noted that Hanjin employees earn much less compared to those working at rival companies. On average, Hanjin workers receive roughly 45 million won a year, whereas Hyundai Heavy Industries employees earn 75 million won, Samsung Heavy Industries 70 million won and STX 66 million won a year.

Son Bum-kyu, another GNP lawmaker, lashed out at the HHIC chairman for his absence amid growing tensions between labor and management. Cho did not show up for an earlier parliamentary hearing on June 29, citing an overseas business trip. Cho returned home earlier this month after staying abroad for about two months.

“He fled overseas to avoid the parliamentary hearing, and even since his return, he made little efforts to resolve the labor dispute, turning the situation into a political issue,” Son said.

Rep. Hong Young-pyo of the main opposition Democratic Party urged the management of HHIC to take responsibility for the company’s worsening financial situation.

“The company made a significant profit thanks to its shipbuilding business,” he said. “Didn’t Hanjin suffer a predicament because of its ill-judged investment in the construction industry, which resulted in a loss of 102.3 billion won?”

Chairman Cho offered an apology and pledged to make efforts to rehire laid off workers in the near future.

“I apologize for the unnecessary trouble and misunderstanding that I caused,” he said. “I will do my best to reinstate those who had to leave the company, as soon as possible.”

He maintained that the layoffs were “unavoidable” due to declining orders and soaring prices, saying his company received no new orders since 2009.

“The 2008 global financial crisis has dealt a serious blow,” he said.

HHIC laid off more than 400 workers at its shipyard in the southern port city of Busan last December.

In late June, the firm signed a deal with workers to end the strike by promising more favorable retirement benefits to those who resigned voluntarily.

However, some union workers refused to accept the agreed-upon terms and the company used physical force to drive protesting workers from its shipyard in Yeongdo, Busan.

The issue drew much of the public interest partly because Kim Jin-sook, a former HHIC worker and local trade union member, has been staging a sit-in atop a 35-meter tower crane at the Yeongdo shipyard since January.