Hanjin's Dismal Ethics Record

Comment from a reader on Enough is Enough Hanjin

Even though you state that you are politically neutral and unbiased, I get the sense that you are enjoy bashing Koreans and everything associated with Korea. Is it the fault of Korean individuals and companies to invest and visit the Philippines when your government and country clearly needs foreign currency injections.

I see it as a necessary evil to the Philippines because you cannot survive alone on your economy. Likewise, don't blame the Koreans/ Korean corporations for what is occurring. Take a deeper look inside and you must accept that it is your government that allows for these actions to occur. Likewise, your culture allows for the acceptance of bribes, payments, or whatever you want to call it. You must root out this underhanded culture if you want to improve your country.

You are just putting the blame on a nationality/ entity that you cannot solve internally. If the Filippino people were righteous and moral and condone all these actions, then theoretically, your government would apply these principles. But because of your ingrained culture and acceptance of bribery and of personal gain, your governemnt reflects these morals. If this is too hard to understand, "Don't hate the game, hate the player"

[The Subic Bulletin] As we have stated many times we welcome foreign investment but what your saying is that its OK for a foreign investor to take advantage of the people of another country? To exploit the weakness of that other country just because you can?

Your concept expands out to do whatever you can get away with is OK? We don't agree!

Its true that the Philippines has a corrupt system where politicians and government employees steal from the government coffers which handicaps the developing of the country, but does that make it OK for other countries to move in and flout Philippine laws with impunity just because they can get away with it? That really does sound like an INVASION!

Apart from the enormously high rate of industrial accidents and bosses physically attacking local employees, Hanjin has abused its power elsewhere in the Philippines.

Here is some further information we collected on Hanjins dubious activities:

Hanjin also entered into major infrastructure contracts with the Philippine government, among them two dam and irrigation projects in Northern Samar, major repairs in the Davao International Airport and irrigation projects in Bohol.

If its record in minimizing the high rate of industrial accidents in Subic is dismal, its record in delivering on its contractual commitments in these infrastructure projects has so far been consistently miserable. Hanjin has defaulted on its contractual payments to a subcontractor in the Davao airport project. It has also fought demands for the full settlement of the wages of hundreds of workers it hired in the Bohol irrigation projects.

In the Northern Samar irrigation projects—which were designed to water poverty-stricken rice farms in Catubig, Hagbay and Bulao—construction is hopelessly delayed. Hanjin has so far accomplished only 13.58 percent of the project since it landed the contract almost two years ago. The National Irrigation Administration (NIA) had invoked provisions of the contract with Hanjin that it would take over the construction since it has become clear that Hanjin does not have the capability to complete it on time. Hanjin, however, went over the head of NIA Administrator Carlos Salazar and managed to get an extension of 158 calendar days—thus moving the scheduled completion date from March 31, 2010, to August 25, 2010—or long after the presidential election. How was this extension made possible? Hanjin apparently can afford to be smug about it.

Hanjin, according to NIA officials, did not even build an access road to the project site as stipulated in its contract. What it did was wait for Northern Samar Gov. Raul Daza to complete a farm-to-market road in a nearby area so it could bring its heavy equipment to the work site. Daza allowed the company to use the road provided it would repair any damage caused by the transport of the heavy trucks and backhoes. When the road was finished, Hanjin did not even use the road. Instead, it came up with new excuses as to why it has barely started work on the projects.

To this day the NIA is still demanding to take over the project because Hanjin—whose core business is shipbuilding—seems to lack the capability to undertake a dam project of this complexity and magnitude.

In the much smaller Malinao dam and irrigation project in Pilar, Bohol, which was undertaken in 1991 and 1992, it was a case of unfair labor practice. Hanjin gave hundreds of local workmen it hired for the project a raw deal. It claimed before labor authorities that the laborers stole gasoline and other materials from the job sites. The workers disputed this allegation. They insisted that they were actually hired to work on several other projects but were also used in the dam project, which was not what they were made to believe. They sued Hanjin before the National Labor Relations Commission (NLRC). After hearing the Bohol workers’ case, the NLRC ordered Hanjin to pay them fully since the workers were hired and deployed several times and must be treated as regular employees. To skirt our labor laws, Hanjin had hired and fired these workers after every six months on a contractual basis and treated them all as casual workers.

The NLRC decision was consequently upheld first by the Court of Appeals and finally by the Supreme Court (SC) on April 10, 2006. The High Court ordered Hanjin to pay the workers millions in back wages and benefits.

Hanjin right now is also under fire for not complying with the decision of the Construction Industry Arbitration Administration, which found Hanjin liable for enriching itself at the expense of a subcontractor who did 94 percent of the work to modernize the Davao International Airport.

What happened was Hanjin signed a subcontract with Dynamic Planners and Construction Corp. (DPCC) in 2000 to build the airport after Hanjin had won the award of the project from the Department of Transportation and Communications (DOTC) in 1999. DPCC, true to its contractual commitment, had finished 94 percent of the project when it realized it was being played for a sucker by Hanjin. Hanjin had received full payment for the project from the DOTC but its own payments to the subcontractor were far behind the project billings. Its excuse: DPCC had not faithfully followed design specifications. DPCC spent a fortune for salaries and procurement of construction materials, and here was Hanjin reneging on its payments.

The dispute is now the subject of a tedious and costly legal battle. After five long years, DPCC has succeeded only in having a temporary restraining order that had stymied its efforts to collect some P258 million worth of work that it had put in the Davao airport project. The SC struck down the TRO only early this year.

To this day, Hanjin has not paid what it owes DPCC. DPCC, meanwhile, has lost its Triple A accreditation with the banks because of its legal battle with Hanjin. It has also run into some serious liquidity problems—all because Hanjin does whatever it can get away with.

[The Subic Bulletin] We know that some of our readers are Hanjin contractors/suppliers and love to write in waving the "racist" flag every time we print something about Hanjin but just remember, you may be the next in line for Hanjin's abusive treatment, because the law/government won't protect you and its seems anything Hanjin can get away with is OK for them...