Union demands for "profit-sharing bonuses," ignited at Samsung Electronics (005930.KS), are rapidly spreading across Korea's industrial sector.
The labor union at HD Hyundai Heavy Industries recently finalized its wage and collective bargaining proposal, which includes a clause demanding that "30 percent of operating profit be shared as performance bonuses." In-house subcontractor unions, which are conducting wage negotiations simultaneously with the full-time employee union at HD Hyundai Heavy Industries, also insist on receiving bonuses at the same level as those from the prime contractor. The Hyundai Motor (005380.KS) union, which held a collective bargaining kick-off ceremony on the 13th, demanded 30 percent of net profit. If the union's demand is met, Hyundai Motor — which posted net profit of more than 10 trillion won last year — would have to hand over more than 3 trillion won as the union's share. Beyond these, major unions across various industrial sectors, including Kakao (035720.KS) and Samsung Biologics (207940.KS), are in conflict with management over profit-sharing issues.
The unions' demand to distribute bonuses at a fixed ratio is tantamount to an unreasonable insistence that companies abandon the virtuous cycle of future investment, innovation, and growth in order to line their own pockets. Securing future competitiveness through bold investment and swift market response is an essential condition for survival in a rapidly changing global industrial environment. Nevertheless, the Samsung Electronics union is unreasonably insisting on "institutionalizing bonuses" — which places a serious burden on management — without considering the ripple effects. On top of this, unions from companies with entirely different business environments, financial conditions, and industry characteristics, along with subcontractors and partner firms that gained bargaining rights through the Yellow Envelope Act, are joining in unreasonable demands for bonus distribution, raising concerns about the future of Korea's industry.
If Korea's key export-driving industries — semiconductors, shipbuilding, and automobiles — are held back by excessive union demands and lose their capacity for future investment, K-industry will suffer a fatal blow. In the fierce global competition, if Korean companies falter even for a moment, it is only a matter of time before they lose their competitiveness and are left behind. Germany's automotive industry, which once dominated the world, fell behind in the transition to new technologies and plunged into a slump, now facing the risk of losing 225,000 jobs within 10 years. If unions do not abandon their get-rich-quick mentality and selfishness of staging a "cash bonanza" at the expense of the future, neither corporate survival nor stable jobs can be guaranteed. Labor and management must find a compromise through dialogue between investment for the future and proper compensation for performance, opening the path to coexistence and sustainable growth.
