With only four days left until the strike date announced by the Samsung Electronics union, labor and management agreed to hold a "final showdown" at a second round of talks on the 18th. Attention is on whether the two sides can reach a dramatic settlement after Samsung Electronics Chair Lee Jae-yong issued a public apology and appealed for everyone to pull together as "one family."
◇ Samsung Electronics, final showdown on the 18th ahead of strike
According to the industry on the 17th, the Samsung Electronics labor and management sides will attend the second post-adjustment meeting to be held on the 18th at the National Labor Relations Commission (NLRC) in Sejong. With a strike looming, it is highly likely to be effectively the final showdown. Previously, Samsung Electronics labor and management conducted post-adjustment under NLRC mediation and held negotiations from the 11th to the 13th, but talks broke down as they failed to narrow differences over performance bonus criteria.
Labor and management are signaling a willingness to engage in sincere talks. Management accepted the union's demand and replaced its chief negotiator from Vice President Kim Hyeong-ro to Ye Myeong-gu, DS (semiconductor) People Head of Team. Ye is the head of human resources for the institutional sector of the semiconductor business. The supra-enterprise union Samsung Electronics chapter, which holds a majority at Samsung Electronics, said, "Management accepted the demand to replace the chief negotiator and agreed to resume talks." To enhance understanding of the negotiation process, the union also accepted management's request that Vice President Kim attend the mediation without speaking, with both sides taking a step back and agreeing to continue sincere negotiations.
The previous day, Lee personally apologized and sought to reassure the union, saying, "We are one body, one family." Returning to Seoul's Gimpo Business Aviation Center (SGBAC) in Gangseo District on the 16th after a business trip to Japan, Lee told reporters, "Samsung family, we are one body, one family. Now is the time to wisely pool our strength and move in one direction," adding, "I will stand in the driving rain and take all the blame. Let's do our best so we can be proud to be Samsung people." He continued, "I bow my head to express my apology for causing concern to our customers and the public."
◇ Government emergency adjustment power emerges as a variable
In these talks, the union is demanding institutionalization to fix the performance bonus at 15% of operating profit and abolish the bonus cap. Management, on the other hand, proposed maintaining the existing performance bonus system while paying 10% of operating profit as a special reward without a cap if the company achieves No. 1 in the industry. Fifteen percent of operating profit amounts to 45 trillion won, considering this year's Samsung Electronics performance outlook of 300 trillion won. For semiconductor employees on average, that approaches 600 million won.
Following Lee's appeal, Prime Minister Kim Min-seok mentioned in a public address the possibility of invoking emergency adjustment powers in the event of a general strike, raising the chance that labor and management could wrap up talks dramatically. In a public address that day, Kim said, "Instead of insisting on a strike, the Samsung Electronics union should make efforts to find common ground through dialogue and compromise," adding, "If a strike is feared to cause significant damage to the national economy, the government will consider all possible response measures, including emergency adjustment." Choi Seung-ho, chairperson of the Samsung Electronics supra-enterprise union, said that day, "We have reviewed the prime minister's address and will faithfully participate in post-adjustment so that labor and management can achieve harmony."
If talks break down, the union has maintained that it will press ahead with the strike. The union has announced an 18-day general strike from the 21st to July 7. If the government invokes emergency adjustment powers in response to the union's strike, the union must immediately halt industrial action and strikes are banned for 30 days. Continuing to strike during this period could prompt an investigation on suspicion of legal violations. For 30 days, labor and management must resume negotiations, and if they fail to reach agreement, the NLRC chair decides ex officio to refer the case to arbitration. Once an arbitration plan is issued, labor and management must follow it.
Since the emergency adjustment system was introduced in 1963, it has actually been invoked four times. These were the 1969 Daehan Shipbuilding strike, the July 1993 Hyundai Group Federation of Unions strike, and the 2005 Asiana Airlines and Korean Air Lines strikes. In 2016, when the Hyundai Motor union went on strike, labor and management reached a dramatic agreement after the government signaled a declaration of emergency adjustment, so it was not invoked. Labor circles are strongly expressing opposition to invoking emergency adjustment powers. The Federation of Korean Trade Unions said in a commentary that day, "An attempt to apply emergency adjustment solely because of large economic ripple effects risks becoming a precedent that effectively restricts the right to strike of large corporate workers," condemning it as "highly inappropriate."