WORKERS at South Korea’s two largest automakers went on strike for wage reforms today.

Trade unionists at Hyundai Motor Co and its subsidiary Kia Motors Corp downed tools for four hours.

They have held 17 rounds of talks with the management over the past two months but have been unable to reach a compromise, a Hyundai Motor Union (HMU) spokesman said.

“Negotiations stalled on whether to count regular bonuses towards ordinary wages,” he said.

This would increase workers’ incomes by an average of 10 per cent through increasing overtime pay, he added.

The union said its workers would also refuse to work overtime this weekend.

The strike could cost Hyundai-Kia Motor Group a total of some £38.6 million in lost production.

HMU voted for the strike on August 14, with 70 per cent of its 47,262 members voting in favour of industrial action.

The Supreme Court ruled in December last year that regularly-paid bonuses should be considered as part of ordinary wages.

Ordinary wages are used as the basis for setting allowances such as overtime pay, holiday shift pay and paid annual leave, as well as pensions, according to the law.

Hyundai is South Korea’s largest car manufacturer and its fourth-quarter net income climbed by 15 per cent in 2013 to 2.06 trillion won (£1.2billion) from 1.79tn won (£1.05bn) in 2012.

The company will probably post another record profit this year, according to analysts’ estimates.