Hyundai Motor Co. and its labor union reached a tentative wage agreement Tuesday, raising expectations of averting a strike for the fifth consecutive year, the company said.
The deal includes a 111,000 won (US$83.55) rise in monthly basic pay, or a 4.8 percent on-year raise, as well as a bonus and performance-based benefits.
The deal is subject to a union members' vote scheduled for Monday.
The two sides also agreed to hire around 800 new production workers over the next couple of years.
The carmaker and the union reached wage deals without strikes in each of the past four years amid South Korea's trade dispute with Japan, the COVID-19 pandemic and other issues.
The unionized workers earlier decided to launch a partial strike on Wednesday and Thursday, as their negotiations with the management had made little progress.
The two sides began wage talks in June, and have held 23 rounds of official negotiations, including one held Tuesday.
The company proposed an increase of 106,000 won in basic salary, plus a cash bonus and other benefits, while the union demanded a 184,900 won rise, bonuses, performance-based benefits bonus and an extension of the retirement age from 60 to 64.
The agreement came as the company has shown a stellar performance recently despite unfavorable business circumstances, such as global supply chain disruptions and an economic slowdown.
For the second quarter of this year, Hyundai logged a record quarterly operating profit of 4.24 trillion won driven by robust sales of its premium models.
The carmaker posted a record operating profit for three quarters in a row through the second quarter, and it raised its full-year earnings estimates for 2023.
Under the agreement, the two sides vowed to push for the construction of a new factory at home to develop next-generation automotive light materials and advance casting technologies.
The company also decided to extend supports for employees with children or those who plan to have babies as South Korea is struggling with a chronically low birthrate.
"The two sides will continue talks on an extension of the retirement age in line with possible changes to the government rules and social norms on the matter," a company official said.
Source: Yonhap News Agency