Samsung Electronics' (005930.KS) post-mediation talks with its labor union over performance bonuses, conducted under the arbitration of the National Labor Relations Commission (NLRC), have ultimately collapsed. As a result, the Samsung Electronics labor union is essentially preparing to walk away from negotiations, with a countdown underway to the second general strike in the company's history. If the nation's largest industrial base — its semiconductor plants — comes to a halt, damage to the national economy, including reduced exports and a slowdown in regional economies, is expected to be unavoidable.
The Super Corporate Union announced Wednesday that it had ended the meeting on the final day of the NLRC's post-mediation process. The session began at 10 a.m. the previous day and ran for about 17 hours, extending past 3 a.m.
"After we requested a mediation proposal from management, the plan they presented 12 hours later was actually a regressed outcome," said Choi Seung-ho, head of the Samsung Electronics branch of the Super Corporate Union. "They proposed a special management performance bonus limited to 2026 and only for the Device Solutions (DS) division, without institutionalizing it."
According to the union, management offered a performance bonus equivalent to 12 percent of operating profit, but only for the DS division. The proposal also came with the condition that the division must achieve its highest-ever operating profit on a domestic basis this year.
The union expressed particular disappointment that, beyond simple reductions in figures, management intends to maintain the existing Overall Performance Incentive (OPI) system based on the Economic Value Added (EVA) method. The 50 percent ceiling would remain in place, and management refused to apply a stock-based compensation system.
Regarding the 18-day general strike set to begin on the 21st of this month, Choi said, "As of today, the number of participants stands at around 41,000. Given the company's proposal, we expect more than 50,000 union members to take part."
Meanwhile, Kim Hyung-ro, Samsung Electronics vice president and a member representing management, said, "The company did not officially present a mediation proposal." The NLRC also stated that "the mediation process ended without a proposal being presented."
