Homeplus unpaid wages hit record W387.1b amid rehabilitation

Homeplus, which is undergoing court-led rehabilitation, has accumulated nearly 400 billion won in unpaid wages, with 66.4 billion won still unresolved.

Data obtained by the office of People Power Party lawmaker Kim Wi-sang of the National Assembly's Climate, Energy, Environment and Labor Committee from the Ministry of Employment and Labor on Tuesday showed that Homeplus's cumulative unpaid wages from last December through August this year totaled 387.1 billion won ($288 million) — the largest ever recorded for a single company, surpassing the previous record of 119.7 billion won set by Daewoo Winia Group.

Homeplus has paid out 320.7 billion won of the total under guidance from the Employment and Labor Ministry, but 66.4 billion won — 17.2 percent of the total — remains outstanding. The unpaid amount comprises 51.3 billion won in wages for July and August, 12.9 billion won in severance pay for departed employees, and 2.2 billion won in unused annual leave allowances. Homeplus failed to pay wages on time for 9,874 workers totaling 26.3 billion won in July and for 9,016 workers totaling 25 billion won in August.

Shortfalls in severance pay reserves have also drawn scrutiny. Homeplus is required to set aside severance funds but has fallen below the legally mandated minimum reserve ratio of 100 percent. The company's required reserves stand at 466.11 billion won under the defined-benefit plan and 228.48 billion won under the defined-contribution plan. Actual contributions, however, were limited to 372.83 billion won for the defined-benefit plan — a funding ratio of 79.9 percent — and 196.35 billion won for the defined-contribution plan, at 85.94 percent.

Homeplus, which had teetered on the brink of bankruptcy, has been carrying out its repayment plan after a court approved its rehabilitation proposal on Sept. 2. The retailer resumed operations at 67 stores on Aug. 13 as it seeks to normalize its business. It plans to convert all multi-floor stores to single-floor layouts and reduce the total floor area of each store to around 3,300 square meters.