New IBK Industrial Bank of Korea CEO Jang Min-young (장민영) failed to report for his first day of work amid strong opposition from the union. How he resolves labor-management conflict, ahead of business performance, has emerged as his biggest task.

Financial Services Commission Chairman Lee Eok-won (이억원) on Jan. 22 nominated Jang to be appointed IBK chief executive, completing the selection of policy bank heads. IBK has a structure in which the Financial Services Commission nominates the CEO and the president appoints the person. Jang is an internal candidate who spent about 35 years at IBK and its affiliates in key posts, and the commission assessed him as the right person to expand financial support for small and micro businesses.

IBK said in a Financial Services Commission work report last month that it would pursue the "IBK-style productive finance 30-300 project" to supply at least 300 trillion won in productive finance by 2030. It aims to expand funding support for advanced and innovative industries, start-ups and venture firms, and small businesses based in regional areas, and to strengthen comprehensive financial and non-financial support to help small and micro businesses grow and address management difficulties.

But labor-management conflict came to the fore from day one. The IBK union began a campaign to block the CEO from entering work immediately after the appointment was announced. Jang was blocked by the union on Jan. 23 on his first trip to the headquarters on Euljiro in Seoul and was unable to enter, turning back. He is expected to begin work for the time being from a temporary location, according to reports.

Union members responded strongly, shouting at Jang to secure the president's promise to resolve the issue of overdue payments.

Union opposes 'CEO with no alternative'

The key issue the union is raising is the total payroll cap system. The union argues that while overtime pay was replaced with compensatory leave, it is difficult to use in practice and effectively amounts to unpaid wages. In a union-wide vote on Dec. 23, 91 percent approved a general strike, and the possibility of a strike as early as late this month is also being discussed.

The issue reached the level of presidential remarks. President Lee Jae-myung (이재명) said in last month's Financial Services Commission work report, "There is talk that IBK's unpaid wages are in the 100 billion won range, and if that is true it is not something to just let pass." He added, "Do not just repeat the existing explanation, and present a plan detailing how you will resolve it," instructing officials to do so.

The union criticises Jang's appointment itself as a managerial appointment with no alternative to solve the structural problems IBK faces. In a statement, it said, "We cannot agree to appoint a CEO who comes empty-handed," and "We cannot accept appointing a CEO without an alternative to solve IBK's problems." In particular, it pointed to a lack of visible capability to resolve key tasks by consulting with financial authorities, including the total payroll cap system and securing autonomy over budget and staffing.

The union also believes President Lee's policy will was not sufficiently reflected in this appointment. It said, "This appointment did not include a message that he is the right person to secure IBK's budget and staffing autonomy promised during the presidential election and to complete resolving the total payroll cap system issue directly instructed by the president." It added, "We cannot help but ask whether this appointment is for the bank and employees or for the Financial Services Commission."

The possibility is also being raised that the campaign to block the CEO could become protracted. In the past, former CEO Yoon Jong-won (윤종원) also succeeded in reporting to work for the first time only 27 days after taking office due to union opposition. The union plans to continue blocking entry until the company presents a clear solution, and attention is focused on whether Jang can restore trust with the union and seal the conflict.

Jang expressed his willingness to resolve the issue quickly through labor-management dialogue. Meeting reporters, he said, "There were instructions from the president, and I understand the government is also making active efforts." He added, "As I know well the demands of IBK employees, I will work so that labor and management can join forces to resolve the issue as quickly as possible."