Valeo V Korean Metal Workers' Union (KMWU)

Overview

NCP Decision Suspended
Current Status Suspended
Date Submitted 24/03/2010
Case Duration 455 weeks and 4 days so far
Host Country South Korea  (OECD member)
Sector Automotive 
Issue(s) Closure of a factory without prior information or consultation and massive lay-offs
Provisions Cited III.4  IV.1-a  IV.1-b  IV.6   
Case Description On 24 March 2010, the Korean Metal Workers' Union (KMWU) submitted a complaint to the South Korean National Contact Point concering a subsidiary of the French multinational company, Valeo.

On 26 October 2009, local Valeo management had announced that it would close its factory in Korea, which produced compressors used in final assembly of automobiles. No notice of any kind was provided, nor consultation made with the union or workers, before the closure following a shareholders’ meeting. The workers were informed by telephone after they had started their workdays. Requests for documentations related to the meeting and the factory’s performance were denied. All plant workers were told of their permanent dismissal. This lack of notice violated Korean labor law as well as the terms of an existing collective bargaining agreement.

The complaint also highlighted Valeo’s alleged longstanding anti-union behaviour. Throughout 2008, management obfuscated during collective bargaining negotiations, coming to the table only after an order by the Korean Regional Labor Relations Board. During the 2009 process, the company sought to delay the negotiations and then unilaterally withdrew from the employers’ group representing firms in the rounds.

Finally, the complaint alleges that the company improperly denied facilities for use by the union and filed baseless criminal charges, carrying the possibility of imprisonment, against unionists for simply making reports to workers about negotiations with the company.

Developments On 16 April 2010, the KMWU met with the Korean NCP. At the meeting the Korean NCP informed the KMWU that it would not be able to offer prompt facilitation to resolve the dispute. First, because it feared that prompt examination of the case might be prejudicial to the outcomes of a 26 February 2010 filing the KMWU had made to the Regional Labor Relations Commission. But secondly, the Korean NCP stated that timely consideration would be difficult because fo the requirement to involve several government ministries, thereby delaying any determination on whether the case merits further investigation.

On 22 April 2010 the KMWU sent a letter requesting that their case be promptly examined, and then on the 4 May 2010 sent another written request for examination of their urgent case. The union also held a small demonstration in front of the Korean NCP Office in Gwacheon Government Complex to call on the Korean NCP to give prompt consideration to their urgent case.

Meanwhile, a group of workers has remained on the factory site, maintaining the property and machinery in the hopes that management will return to negotiate. The situation became potentially tense in June 2010, when reports circulated that the company would have essential services like water and electricity cut and possibly have the police forcibly remove the workers.

Delegations from the union have now made two trips to Paris, France, in an attempt to meet with the central management of Valeo. So far, no attempt has been made by Valeo to engage the workers, with management demanding that they concede the permanent closure of the plant as a condition for talks. One delegation, in association with several of the French trade unions, arranged a meeting with Mr Michel Doucin, the French Ambassador for Corporate Social responsibility, in early June 2010.

In its 2010 Annual Report to the OECD, the Korean NCP reports that an initial assessment by the NCP is underway and that separate deliberations are ongoing at the National Labour Relations Commission.

Organisations

Lead NCP South Korea NCP : Independent Expert Body 

Companies

Multinational Company Valeo (Home country: France)
Subsidiary Valeo Compressor Korea (VCK) (Home country: South Korea)

Complainants

Lead Complainant KMWU : National Sectoral Union 

TUAC Analysis

Did the NCP publish its initial assessment? status-icon
Did the case involve parallel proceedings? status-icon
Was the existence of parallel proceedings an obstacle to the NCP accepting the case? status-icon
Was the businsess relationship other than that of a subsidiary? status-icon
Was the nature of the business relationship an obstacle to the NCP accepting the case? status-icon
Did the NCP inform other relevant government departments about its acceptance of this case? status-icon
Did the NCP offer mediation or conciliation? status-icon
Did the company accept the offer of mediation or conciliation? status-icon
Did the complainant(s) accept the offer of mediation or conciliation? status-icon
Was mediation or conciliation held? status-icon
Was mediation or conciliation conducted by a professional mediator? status-icon
Did the parties reach agreement? status-icon
If yes, did the NCP publish this agreement following the consent of the parties? status-icon
If mediation was refused or failed did the NCP make an assessment of whether the company had breached the Guidelines? status-icon
Did the NCP conduct in-host country fact finding? status-icon
Did the NCP make recommendations to the company on the future implementation of the Guidelines? status-icon
Did the NCP publish its final statement or report? status-icon
Did the NCP provide for follow-up of the agreement/recommendations? status-icon
Did the NCP inform other relevant government departments about its final statement or report? status-icon
Did the NCP inform public pension funds about its final statement or report? status-icon
Did the NCP apply any consequences in this case? status-icon
Did the NCP follow the indicative timescales set out in the procedural guidance? status-icon
Was there a positive outcome for the workers involved in this case? status-icon
Did the filing of the case under the Guidelines have a positive impact for the workers involved? status-icon
Did the lead NCP play a positive role? status-icon
If different, did the home NCP play a positive role? status-icon

Implications

Parallel legal proceedings making it impossible for the worker to have access to timely remedy