SEOUL, Aug. 24 (Korea Bizwire) – A Seoul court is set to issue a ruling on the case involving wages at Kia Motors Corp. next week, a judiciary official said Thursday, a decision that could have far-reaching consequences for South Korean industries.
Next Thursday, the Seoul Central District Court will decide whether to count “regular” bonuses at the carmaker as part of basic wages, the court spokesman Kim Shin-yoo said over the phone.
Kia officials were not immediately available for comment.
Unionized workers at Kia brought the case to court in late 2011, seeking higher wages and severance pay. The company has balked at the lawsuit, calling their demands “excessive” given declining sales in its major markets.
In the January-July period, Kia sold 149,672 vehicles in China, the world’s largest automobile market. This represents a 54 percent plunge from 326,595 units sold in the same period a year before, the company data showed.
Companies in the related industries are closely watching the developments as they too may have to bear higher financial burden for their workers if the court rules in favor of Kia’s union.
“The company will immediately have to put aside 3.1 trillion won to retroactively pay higher wages to its workers,” a Kia spokesman said. Payment for immediate expenditures could reach 3 trillion won, with outlays in related industries expected to rise to more than 30 trillion won, according to local reports.
If regular bonuses are included in wages, workers will receive higher wages and more retirement benefits when they leave a company.