Six major Korean business groups issued a joint statement Thursday urging Samsung Electronics' (005930.KS) labor union to withdraw its planned general strike scheduled for the 21st, warning that proceeding with the walkout would cause massive damage including production disruptions, eroded trust within global supply chains, customer defections, and a decline in the country's credit rating.
The Korea Enterprises Federation issued the statement jointly with the Korea Chamber of Commerce and Industry, the Federation of Korean Industries, the Korea International Trade Association, the Korea Federation of SMEs, and the Korea Mid-sized Enterprises Federation, saying "a large-scale strike goes beyond a simple labor-management conflict and raises serious concerns about national opportunity losses."
The business groups warned that "semiconductor exports account for approximately 37% of Korea's total exports this year," adding that "a strike by the Samsung Electronics union would directly lead to immediate export declines and a worsening trade balance, cause tax revenue shortfalls in national finances, and potentially have negative effects across the entire national economy." They also noted that "Samsung Electronics is the No. 1 company accounting for about 25% of KOSPI market capitalization," warning that "losses from the strike will trigger declines in the overall KOSPI index, accelerate foreign capital outflows, and could significantly contract the domestic capital market."
The business groups expressed concern that strike losses could be passed on to small and mid-sized partner companies, shaking the entire domestic semiconductor value chain. The business community said "a general strike could deal a direct blow to thousands of small and mid-sized partner companies and their workers, and further to the entire semiconductor materials, parts, and equipment industry," worrying that "partner companies could face cascading production halts and employment instability, and disruptions in semiconductor supply will lead to instability in parts supply across the global electronics industry."
The business community pointed out that the performance bonuses demanded by the Samsung Electronics union are "a demand for distribution of corporate profits, an issue on which courts have already ruled 'not wages,'" describing them as "inappropriate and excessive." They argued that the approximately 45 trillion won in performance bonuses demanded by the union exceeds four times last year's total shareholder dividends, which could seriously undermine the company's sustainable investment capacity and future competitiveness.
The business community argued that "the performance bonus issue is a matter of management judgment rather than a subject for collective bargaining," claiming that "excessive performance bonus demands by some unions could deepen the dual structure of the labor market and increase social discord."
The business groups raised their voices calling for the government to invoke its "emergency adjustment power," considered the government's last resort, if a strike occurs. The business groups urged that "since damage to Samsung Electronics is already materializing even before the strike begins, if a strike occurs, emergency adjustment power should be invoked immediately to prevent irreversible damage to the national economy and industrial ecosystem."
