Thu, Dec 30, 2004 - Page 10 News List

Telecom union declares `holy war' over pensions


The Chunghwa Telecom Co (中華電信) Workers' Union may stage a strike ahead of the state-run company's planned overseas share offering -- possibly in February -- as the ongoing labor dispute escalates over retirement benefits after privatization, the union said yesterday.

The union's announcement came after the Ministry of Transportation and Communications said the government would not cave in to the union's demands for a monthly payment for retirees.

There is simply no such precedent for such a move, the ministry said.

The government, which holds a 65-percent stake in Chunghwa Telecom, insists on making a lump sum payment when an employee retires.

In addition, the ministry said it is determined to fulfill the task of privatizing Chunghwa Telecom.

The government in May said it aimed to lower its stake in Chunghwa Telecom to below 50 percent this year. The ministry has rescheduled the timetable to the end of next year, as the union has protested against the privatization plan over concern that workers would lose the benefits they held as government employees.

In response to the tough talk, union head Simon Chang (張緒中) said "the strike is for real this time. The request for pensioners to obtain their payment on a monthly basis is nothing." The union is waging a "holy war against unfair treatment," Chang said.

Chunghwa Telecom has already allocated NT$80 billion in funds for the retirement payments, Chang said.

The union, which represents 25,000 Chunghwa Telecom workers, may schedule the strike before the issuance of more American Depository Receipts in February, to highlight the labor disputes, Chang said.

The ministry plans to sell a 16-percent stake in Chunghwa Telecom next year to move forward with the privatization plan, despite the fact that negotiations have stalled owing to the disputes over retirement benefits.

Before offering any shares, the phone company is required to renew a contract with Chunghwa Telecom workers to secure their working rights.

Union workers and the nation's biggest phone company have been negotiating for seven years for a new contract to cope with the government's ongoing effort to hand the former monopoly into the private sector.

The union workers voted for a strike early this month, but have not taken any actions yet.

Chunghwa Telecom shares have climbed almost 24 percent to NT$62.5 since the beginning of the year on the Taiwan Stock Exchange.

Chunghwa Telecom's ADRs advanced 1.3 percent, or US$0.27, to US$21.09 on Tuesday, or about NT$67.55 a share.

The telecom operator earned NT$47.68 billion, or NT$4.9 per share, on revenue of NT$166.8 billion in the first 11 months of the year.

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