POSCO Direct Hires Surpass 100, but Unions Protest Method and Working Conditions

Sequential Direct Hiring of Over 7,000 Employees Underway

Unions Demand Better Conditions for "S Group"

Steel Industry Faces Growing Uncertainty

Key Variable in This Year’s Wage and Collective Bargaining Negotiations

After POSCO announced its plan to directly hire approximately 7,000 partner company employees, it has been confirmed that the number of in-house subcontracted employees hired so far has exceeded triple digits. However, both the subcontractor and regular worker unions are protesting the method of direct hiring and issues regarding working conditions, which is causing continued friction during this year’s wage and collective bargaining negotiations.

Exterior view of POSCO headquarters. POSCO

According to the steel industry on June 23, POSCO is sequentially proceeding with the direct hiring process for in-house subcontracted employees, and it is understood that the number of people who have completed recruitment so far has surpassed 100. Starting last month with the hiring of 90 employees from Portel—the in-house subcontractor responsible for raw material unloading at the Gwangyang Steelworks—POSCO is gradually expanding the direct hiring operation to cover 7,000 employees in stages.

POSCO is conducting the conversion process in four phases, aiming to complete the first round of direct hiring by September this year. The first phase targets companies subject to Supreme Court rulings, the second phase covers rolling operation support, the third phase includes blast furnace operation support, and the fourth phase involves auxiliary facilities and processes. Each phase will convert approximately 1,500 to 2,000 people, with the company planning to complete the transition of about 7,000 employees within one year.

However, as the 7,000-person direct hiring plan gains momentum, the resulting labor-management conflict has emerged as a key variable in this year’s wage and collective bargaining negotiations. POSCO management and labor began negotiations with an initial meeting on June 12 and are continuing to narrow their differences regarding the intensive bargaining method. The issue of working conditions for newly directly hired employees has also surfaced as a key topic in the negotiations.

Subcontractor unions are demanding improved working conditions regarding the company’s practice of hiring direct-hire employees as a separate “S Group” rather than integrating them into the existing regular employee group. Existing regular employees are also closely watching for any changes in working conditions resulting from the integration of about 7,000 newly directly hired workers.

Currently, the domestic steel industry faces multiple challenges, including sluggish demand, oversupply from China, and rising costs associated with carbon neutrality measures. POSCO Holdings’ consolidated operating profit for the first quarter of this year was 707 billion won, up 24.3% from a year ago, with the steel division’s operating profit at 345 billion won.

Industry insiders say that, given the ongoing external uncertainties, the direct hiring of in-house subcontractors should be an opportunity for labor and management to build trust and lay the foundation for strengthening competitiveness. An industry official commented, “Due to factors such as a sluggish construction market, it will not be easy for the steel industry to recover in the short term,” adding, “Labor and management must work together to minimize the impact of direct hiring and establish a foundation for growth.”

This content was produced with the assistance of AI translation services.