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Hyundai Steel is launching three new subsidiary companies as part of an insourcing drive aimed at enhancing its competitiveness and the well-being of around 7,000 affiliated workers, the firm said Tuesday.
It is the first major manufacturer in the country making the move to directly hire workers from partner companies and provide them with the same benefits, the steelmaker said.
The new entities are established at the locations of the firm’s major production bases — Incheon, Pohang, North Gyeongsang Province, and Dangjin, South Chungcheong Province. All preparatory processes have been completed, including the hiring of staff, and the three were to formally commence operations Tuesday, Hyundai Steel said.
Big manufacturers usually have workers dispatched from partner companies who engage in essential work for them at lower wages compared to those directly hired.
Hyundai Steel has put some 7,000 such workers on the payroll of the new subsidiaries, offering them better pay and welfare benefits, it said. Salary alone will go up by about 30 percent on average, it said.
“Once their operation stabilizes, the new companies will see hundreds of billion won in annual revenue and the around 7,000 workers will have a sense of security about their job,” a Hyundai Steel official said.
“This move, which is the industry’s first, will hopefully have a positive impact on local economies as well,” the official added.
Source: The Korea Herald