Hyundai Motor Company said it will be divesting ownership in its majority-owned subsidiary SMART Alabama LLC, which operates an Alabama auto-manufacturing plant, after the discovery last year that two of the company’s Alabama suppliers had each employed an underage worker.
As reported by Reuters, the South Korea-based multinational carmaker revealed its plans to divest ownership in SMART in a letter to shareholders from the company’s CEO Jaehoon (Jay) Chang, along with the details of its investigation into its suppliers’ labor law practices carried out after learning about the underage workers.
Chang said in the letter, dated February 23, that as Hyundai Motor America goes through the process of divesting its ownership interest in SMART, it intends to do so while ensuring that “the economically important jobs in the Luverne, Alabama community are preserved and that all child labor laws are followed in the future.”
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Chang noted that SMART and another supplier SL Alabama had terminated their relationships with third-party staffing agencies who falsely certified that they had screened and cleared underaged individuals as being of legal age.
Further, Chang said the company will be implementing new, more stringent workplace standards throughout its supply chain following its investigation into its suppliers.
Hyundai will be introducing a compliance training program in collaboration with the US Department of Labor for suppliers on a variety of subjects, he said.
The CEO also noted that the investigation found that Hyundai’s US Tier 1 suppliers were in full compliance with underage labor laws and, as a result, there are no current underage labor issues at these suppliers.
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