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Court Orders Kia to Pay Korean Workers $374 Million
Kia Motors Corp. has been directed by a district court in Seoul to pay its workers in South Korea 420 billion won ($374 million) in additional compensation, Reuters reports.
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Kia Motors Corp. has been directed by a district court in Seoul to pay its workers in South Korea 420 billion won ($374 million) in additional compensation, Reuters reports.
The ruling earlier today stems from a workers’ claim in 2011 that routine bonuses awarded by Kia should be considered base pay, a figure which is used to calculate payments for overtime work, unused annual vacation time and severance.
Korea’s carmaker association claims the court’s decision will lead to similar settlements with workers at other vehicle manufacturers and deal a “fatal blow” to the industry’s ability to compete. The judge countered that Kia’s assertion that the award would threaten Korea’s economy was “inappropriate.”
Kia and parent Hyundai Motor Co. have been struggling with fading profits as its sales drop in the U.S. and China. The companies reported last month that their combined net profit in April-June shrank to its lowest level in five years.
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