Ruling on Hyundai Motor's employer status delayed again; third hearing set for June 15

A decision on whether Hyundai Motor Co. must bargain with subcontractor unions has been delayed once again. Since the so-called Yellow Envelope Act — amendments to Articles 2 and 3 of the Trade Union and Labor Relations Adjustment Act — took effect, subcontractor unions have been pressing Hyundai Motor for collective bargaining, but a ruling on the company's employer status has yet to come.

According to business and labor circles Sunday, the Ulsan Regional Labor Relations Commission held a second hearing on a petition filed by the Korean Metal Workers' Union seeking correction of a bargaining-demand notice, but adjourned without reaching a conclusion.

The first ruling on Hyundai Motor's employer status has now been pushed to a third hearing on June 15. The Ulsan commission has carried the proceedings into a second month after opening its first hearing on May 20.

The hearings center on whether 1,675 union members affiliated with the Metal Workers' Union and employed by Hyundai Motor subcontractors have the right to demand direct bargaining with the automaker. The workers submitted a bargaining request to Hyundai Motor after the Yellow Envelope Act took effect, but the company rejected it, prompting the union to file a correction petition with the Ulsan commission.

The commission is understood to be struggling with its determination in part because the subcontractor union members span a wide range of job categories, including production, security, cafeteria services, sales and research.

Both the business community and management circles are watching the outcome closely. Hyundai Motor works with roughly 8,500 in-house and external partner companies, and the ruling is expected to send ripples across the broader manufacturing sector, which relies heavily on subcontracting arrangements.

Some observers worry that even after the Ulsan commission issues a ruling, a final determination on employer status could take considerably longer. Whichever way the commission decides, either Hyundai Motor or the union is expected to appeal to the National Labor Relations Commission, the higher authority. If that body's decision is also rejected, the dispute would proceed to administrative litigation.