LABOR: A Summer of Discontent?

After a series of strikes battered South Korea's economy last year, the government hoped that managers and unionists had learned to negotiate across bargaining tables rather than police lines. But disputes have erupted at 340 companies so far this year, suggesting that the country may be in for another summer of labor unrest.

The company hardest hit is the Hyundai conglomerate (estimated 1987 revenues: $23 billion). Trouble started in early May, when a labor leader at the Hyundai Construction Co. was kidnaped in Seoul. Two company executives were eventually arrested and charged with paying thugs $27,000 to kidnap the man to force him to resign from the company. In the meantime, 3,500 workers, demanding 50% pay hikes, had walked out at two machine-tool factories owned by Hyundai Precision and Industry Co. On May 27, strikers at one of the plants seized a five-story office building and took Hyundai Precision Chairman Chong Mong Ku and ten other executives hostage. The managers were released June 1 as police prepared to intervene.

A more serious threat to Hyundai came on May 30, when 20,000 workers struck the company's profitable auto-manufacturing unit, shutting down all 15 of its plants. The strikers are asking for a 48% pay hike. The government is pressuring Hyundai and other companies to resolve their labor problems quickly in hopes that the situation will calm down by the time the Seoul Olympics begin in September.