Samsung Biologics labor and management failed to find common ground at a labor-management-government meeting on the 8th. Instead, the two sides agreed to keep talking, creating a sense that the parties, standing at a crossroads over a strike, are taking a breather for now.
Samsung Biologics and the Samsung Biologics Win-Win Union held a labor-management-government meeting from 2:30 p.m. that day under mediation by the Central Regional Employment and Labor Office, but they could not find a meeting point even after about three hours of talks.
Park Jae-seong, Chairperson of the Samsung Biologics Win-Win Union, said after the meeting ended, "Although no specific agenda items were produced, we decided to continue talks a bit longer in light of the Labor Ministry continuing its mediation and Samsung Electronics also beginning the post-adjustment process."
He added, "In line with the Labor Ministry's recommendation, upcoming negotiations will proceed behind closed doors for the time being."
This meeting was the first official mediation after the union's full strike on the 1st to 5th, and even on this day the sides failed to narrow their differences.
Previously, the union had demanded: ▲ a 30 million won incentive per person ▲ an average 14% wage increase ▲ distribution of 20% of operating profit as bonuses ▲ establishment of fair personnel standards.
The company, by contrast, proposed a 6.2% increase and a one-time payment of 6 million won. There also remains a wide gap over the union's demand to participate in management matters such as new technology adoption, personnel, and mergers and acquisitions (M&A). The company's position is that the demand could infringe on management rights.
Accordingly, the possibility of additional strikes has not been fully eliminated. If the union launches a second strike, the company's losses are expected to grow.
Samsung Biologics said the first full strike disrupted production of some anticancer drugs and human immunodeficiency virus (HIV) treatments. The company estimated the damage at a minimum of 150 billion won. The initially expected damage was about 640 billion won, but losses were reduced by deploying emergency personnel, the company said.
The rift in labor-management conflict is also deepening. Samsung Biologics filed a complaint with the Incheon Yeonsu Police Station against six people, including Park, the Chairperson, and two other union executives, as well as three rank-and-file on-site managers, on charges of business obstruction. The company's view is that the union effectively encouraged strike participation in work areas where the court had restricted industrial action as non-suspendable during disputes.
Earlier, the court allowed industrial action in initial production processes such as cell culture, purification, and virus filtration, but determined that certain processes with a high risk of drug deterioration—such as concentration and buffer exchange (UFDF), drug substance filling (DS filling), and related buffer manufacturing and supply—must not be halted even during a strike.
The union's distributed "strike guideline procedure" reportedly stated, "Even if your annual leave is rejected or its timing is changed, please join the strike according to union guidelines."
In response, the union said, "We organized essential personnel and carried out the work," and countered that "the company is making an unreasonable claim aimed at psychological intimidation." The company also appealed the court's partial dismissal of its request to ban industrial action.
Concerns are mounting in industry and the securities market that a prolonged labor dispute will have negative effects on multiple fronts. With corporations in various countries investing aggressively to build contract development and manufacturing organization (CDMO) competitiveness, fears over production stability could hurt global trust, contract wins, and second-quarter results, critics say.
Heo Hye-min, a researcher at Kiwoom Securities, said, "As the strike has caused a decline in sales, an impact on operating profit is inevitable," and analyzed, "If negotiations drag on, it could adversely affect not only second-quarter results but also big pharma order wins."
For Samsung Biologics' second quarter, the market consensus (average forecast) is 1.2924 trillion won in revenue and 598.3 billion won in operating profit, but Heo said those figures do not reflect the impact of the strike and should be revised downward.