News

Workers at HomePlus, Korea’s second-largest discount supermarket chain, have been left vulnerable to the potentially negative impact of restructuring after private equity fund, MBK’s acquisition of the chain from British supermarket giant Tesco. 

Trade unionists feared that this could be the worst case scenario for workers who are now in a very precarious situation. Tesco are said to have made exorbitant profits from the sale of HomePlus, which has nearly 800 outlets in South Korea and employs around 26,000 workers.

The company has been suffering a protracted and sluggish downturn in profits as a result of the growing popularity of online shopping and door-to-door delivery services. These developments have been substantially hampering the growth and competitiveness of discount stores such as HomePlus.

The unions in Korea have been trying to make sure that these changes in the market and the subsequent loss in profits for companies are not taken out on workers by cutting pay or harsh restructuring.

Head of UNI Commerce Alke Boessiger said, “We fully support our South Korean affiliates in their struggle for job security. Although MBK have promised HomePlus workers that they will be fairly treated and be afforded the job security they deserve, we have our doubts as to the sincerity of those promises.”

“UNI shares the reservations of Korean affiliates that, in MBK’s inevitable attempts to boost the corporate value of the company, workers may suffer.”

Members of the HomePlus union viewed MBK’s promise of job security with suspicion, saying “We will fight until our job security is absolutely guaranteed.”

“We hope that we will be able to settle the workplace issues with MBK management, but given the nature of private equity funds, we fear that MBK will restructure in future to try and increase the resale value of the company.”