Unionized workers and the management of Kumho Tire on Monday announced a set of agreements for 2016, putting an end to a marathon negotiation that has visibly hurt the company’s business for the past nine months.

The two parties have agreed on a pay raise of 2.76 percent of the basic salary on top of a 1,180 won ($1) increase. Kumho in 2017 will adopt the wage peak system in which workers agree to slice their wage after reaching a certain age in exchange for delayed retirement age, hence guaranteeing job security. Instead, the company will pay 3 million won each to all workers as compensation, while jointly establishing a wage peak committee with the union to overlook the issue. 


The workers and management will sign an agreement to enhance productivity and product quality.

Since May 2015 the two parties have locked horns over several issues including the adoption of the wage peak system. The unionists have conducted a series of partial strikes in August, December and January, and staged a full walk-out in August through September.

Businessmen welcomed the news on Monday, with the Chamber of Commerce in Gwangju-- where the manufacturing plant is located at -- calling for swift execution of the agreement and production normalization.

By Bae Ji-sook (baejisook@heraldcorp.com)