Daewoo E&C sets example of labor-management cooperation

Daewoo Engineering & Construction CEO Baek Jung-wan, right, and Daewoo E&C labor union head Shim Sang-cheol wave during their performance at a singing contest held by the union in Euljiro, Seoul, Aug. 12. Courtesy of Daewoo E&C

Daewoo Engineering & Construction is strengthening the collaboration between management and labor, serving as a model of overcoming a prolonged downturn in the construction industry.

On Aug. 5, Daewoo E&C and its labor union signed an agreement on the company’s updated human resources policy, which includes a revamp of the corporate rank system. The revised plan aims to introduce new methods for performance evaluation and wage calculation based on a simplified ranking structure.

Despite the sensitivity of the issue, management and the union reached the agreement after two years of consultations. Building on this progress, the company said that management and labor are now engaged in constructive negotiations over wages and other collective bargaining matters to achieve mutual benefits.

The spirit of cooperation between the two sides was also evident in a recent event organized by the labor union.

During the union’s 37th founding anniversary on Aug. 12, Daewoo E&C CEO Baek Jung-wan and union head Shim Sang-cheol performed together on stage during a masked singer contest organized by laborers, highlighting their unity.

The amicable scene was a rare occurrence in the Korean construction industry, where many builders are grappling with unstable employment conditions, wage freezes, and labor disputes due to soaring raw material prices, high interest rates, and other uncertainties.

“Daewoo E&C’s transparent and ongoing negotiations with its labor union have resulted in tangible changes in labor-management relations and set a positive example in the construction industry,” a Daewoo E&C official said.

“With the management and the union building trust, the company is becoming more confident about overcoming the current uncertainties. Going forward, we will maintain this mutually beneficial relationship.”