Samsung Electronics(005930) When the labor union said it would put the "Honam semiconductor project" on the 2027 collective bargaining agenda, the Ministry of Employment and Labor (MOEL) drew a line, saying that the decision itself to expand investment and production facilities is not a subject of bargaining.
Where to build a semiconductor plant is a management judgment by corporations. But who moves where and under what conditions people will work as a result of a new plant is a matter of working conditions. The amended Trade Union and Labor Relations Adjustment Act, known as "the yellow envelope law, a new labor law aimed at strengthening the bargaining rights of subcontract workers," did not give unions the right to decide investments; it broadened the scope so they can bargain over the impact of management decisions on employment and working conditions.
The Honam semiconductor project is expected to be an early test of the amended law's implementation, drawing the line between the management decision itself and where changes to working conditions are separated.
◇ Expansion of the scope of labor disputes… Will mandatory bargaining subjects also widen
The Ministry of Employment and Labor (MOEL) said on the 13th that the decision itself by corporations to expand investment and production facilities is not a subject of collective bargaining or labor disputes. It added, however, that if there are substantial and specific changes to working conditions in the course of carrying out the project, related matters could become subjects of bargaining.
The amended Trade Union and Labor Relations Adjustment Act, which took effect in Mar. 2026, added "disagreements over claims surrounding business and management decisions that affect working conditions" to the definition of a labor dispute. Previously, courts had generally found it difficult to regard high-level management judgments concerning a corporation's survival or competitiveness—such as whether to carry out restructuring—as subjects of industrial action. The amendment aims not to categorically exclude from the scope of labor disputes the effects of management decisions on employment, wages, and work arrangements.
Attorney Kim Sang-min of BAE, KIM & LEE LLC said, "Because it is common to understand the scope of labor disputes and the subjects of mandatory bargaining as the same, the expansion of the scope of labor disputes should be seen as leading to an expansion of the subjects of mandatory bargaining."
Attorney Park Sam-geun of Yoon & Yang LLC also said, "Scholars may differ, but the mandatory subjects of bargaining, the scope of labor disputes, and the purposes of a legal strike generally align," adding, "With the amendment known as the yellow envelop bill, the mandatory subjects of bargaining have also expanded."
However, whether the union can put an item on the agenda, whether the company must respond to bargaining, whether it must agree to the union's demands, and whether a strike can occur after talks break down are each separate questions. At the mediation stage before the Labor Relations Commission, voluntary bargaining items can also be addressed, but labor disputes that lead to a legal strike must be limited to mandatory subjects of bargaining.
◇ Building a new plant is a management judgment… Personnel moves may become subjects of bargaining
Whether Samsung Electronics will build a semiconductor plant in Honam, and how it will set the investment scale and product lines, falls under corporations' essential management judgment. Even if the union includes the project in its bargaining agenda, the company is not required to bargain over the plant location or the size of investment, nor must it obtain the union's consent.
Attorney Kim said, "Because pushing the project itself cannot be a subject of bargaining, it will be difficult to recognize an unfair labor practice solely because the company did not respond to it."
Attorney Park also said, "A union can raise an unfair labor practice issue over refusal or neglect to bargain, but if the company responds to bargaining only on parts that affect the determination of working conditions, it will be difficult to deem it an unfair labor practice."
By contrast, if building the plant leads to transfers of existing workers, the matter changes. The pool and selection criteria for reassignment, disadvantages for those who refuse to move, job duties and shift systems, wages and allowances, housing and commuting support, and employment retention at existing business sites can directly affect working conditions.
◇ Bargaining demands can be made even before reassignment is finalized
The issue is at what stage one can say a "substantial and specific change" in working conditions has occurred.
Attorney Kim explained, "There are no precedents or examples to consult yet, but it should be seen as cases where a management decision goes beyond an abstract concept and has a direct and specific impact on working conditions." The view is that unions can demand bargaining even at a stage when reassignment is objectively anticipated.
Attorney Park projected that this standard will ultimately be clarified through court rulings. Park said, "Unions will argue that management decisions affect working conditions from an early stage, while employers will inevitably take the opposite view, so a standard will not be easily established."
If the duty to bargain arises only after the personnel plan is virtually finalized, there is little room left to reflect the union's views. Conversely, if the bargaining scope is widened based merely on the possibility of change, the range of management decisions corporations can make without union consent could shrink excessively.
Attorney Park said, "The facts must be examined case by case, and it cannot be assumed that the duty to bargain is recognized only after the personnel plan is finalized," while adding, "At this stage, we should be cautious in broadening the scope of bargaining subjects."
◇ The key is the specific target of the bargaining demand
It is possible for the Samsung Electronics union to present the Honam semiconductor project as a bargaining agenda item. However, it is difficult to see the union as deciding, or the company as having to obtain consent, on matters up to and including plant location and whether to invest.
By contrast, if reassignment, changes in work location, and job reductions are objectively anticipated due to the new plant, bargaining over employment security, placement criteria, wages and allowances, and housing and commuting measures can be demanded even before the personnel plan is finally fixed.
Ultimately, the judgment changes depending on whether the union demands suspension or changes to the project itself, or whether it asks to consult in advance on expected changes in working conditions due to the new plant. Referring to the "entire project" as a bargaining subject is broad in scope, but the intent to discuss in advance the impact on working conditions aligns with the direction of the amended law.