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🇰🇷 South Korea /Economy & Trade

Samsung Electronics labor and management fail to reach agreement, to resume talks May 20

From Hankyoreh · () Korean

Translated from Korean, summarized and contextualized by DistantNews.

At a glance

News Named sources Context piece
  • Samsung Electronics' labor and management failed to reach a final agreement on issues including performance-based pay after 14 hours of negotiation.
  • The two sides will continue mediation talks on May 20, one day before the union's planned strike.
  • A key point of contention remains the performance-based pay system, with the union demanding 15% of operating profit as the fund and the company proposing over 10% with special bonuses.

The marathon negotiation between Samsung Electronics' labor and management, held under the mediation of the Central Labor Relations Commission, ended without a final agreement. The two sides, facing a potential strike by the union on May 21, will resume discussions on May 20. This prolonged dispute highlights the deep divisions over the performance-based pay system, a critical issue for employees seeking greater financial rewards tied to the company's success.

One point of contention remains, and the labor and management (opinions) do not align.

— Park Soo-geunThe Chairman of the Central Labor Relations Commission, commenting on the failed negotiations.

The union's demand for 15% of operating profit to be allocated for performance-based pay, along with the removal of the cap on bonuses, underscores a desire for a more equitable distribution of the company's profits. In contrast, Samsung Electronics' offer of over 10% of operating profit, coupled with special bonuses, reflects a more cautious approach, likely influenced by market volatility and the need to maintain financial stability. The company's proposal to link special bonuses to achieving over 200 trillion won in operating profit over three years further illustrates this cautious stance.

If the remaining issue is resolved by May 20, the union may postpone the strike.

— Park Soo-geunThe Chairman of the Central Labor Relations Commission, expressing hope for a resolution before the planned strike.

The mediation process, which extended well beyond its scheduled end time, shows the complexity of reconciling these differing perspectives. While progress was made on some fronts, the core issue of performance-based pay remains a significant hurdle. The outcome of the upcoming talks will be crucial; a voluntary agreement could avert a strike and bring a temporary resolution, while continued deadlock could lead to industrial action, impacting production and further escalating tensions. This situation is closely watched by the South Korean labor market, as Samsung's decisions often set precedents for other major corporations.

We will wait at the Central Labor Relations Commission to attend the (additional) post-mediation meeting.

— Samsung Electronics UnionThe union's statement regarding their participation in further negotiations.
DistantNews Editorial

Originally published by Hankyoreh in Korean. Translated, summarized, and contextualized by our editorial team with added local perspective. Read our editorial standards.

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