POSCO to Directly Hire 7,000 Subcontracted Workers in Major Labor Shift
POSCO announced on April 7, 2026, that it will transition approximately 7,000 subcontracted field workers at its Pohang and Gwangyang steelworks to direct employment. This strategic move aims to fundamentally restructure the company’s operational framework by moving away from the traditional prime-subcontractor model.
The decision, described as a bold move by Group Chairman Jang In-hwa, involves a comprehensive roadmap established on April 7 to integrate workers who provide operational support at the two major plants. POSCO intends to initiate formal recruitment procedures for subcontracted employees who wish to transition to direct hire status. This shift is expected to resolve the “outsourcing of risk” and fundamentally strengthen the company’s safety management systems.
For years, POSCO’s steel mills have relied on a dual structure of direct and subcontracted labor due to the necessity of 24-hour facility operation and significant variances in job functions across processes. However, the company is now moving to bring those in direct operational support roles onto its own payroll.
Industry analysts suggest the decision is heavily influenced by a desire to eliminate long-standing legal and regulatory liabilities. Since 2011, POSCO has been embroiled in nearly 15 years of litigation regarding illegal dispatch and the legal status of its subcontracted workers. The pressure from repeated legal losses, coupled with the implementation of the “Yellow Envelope Law” on March 10, 2026, is viewed as a primary catalyst for this resolution.
The initiative reflects the strong will of Chairman Jang In-hwa to clear corporate risks and stabilize the workforce. During a shareholders’ meeting on March 24, 2026, Jang addressed the ongoing friction regarding job categories following a 2022 Supreme Court ruling, stating, “If this leads to prolonged litigation, the burden on the parties involved increases, so I will organize the direction.”
This large-scale employment transition is seen as a significant pivot in how heavy industry leaders manage labor risks and operational stability. By resolving the status of thousands of workers, POSCO aims to conclude the cycle of labor disputes and modernize its workforce management.
Further details regarding the transition are expected as the company begins the formal application and hiring process for the direct employment of subcontracted staff, a move that may put pressure on other major corporations to re-evaluate their own subcontracting structures.
