Samsung BioLogics Labor-Management Talks Fail in Third Round... Stalemate Continues Despite New Employee Stock Loan Interest Support Plan

Differences Over Wages and Bonus Restructuring

The labor and management at Samsung BioLogics have failed to narrow their differences in the third round of post-mediation talks aimed at negotiating wages and employee benefits. Although management proposed a new support plan for employee stock ownership loan interest, the gap on key issues—including wages, bonuses, and the collective bargaining agreement—remained significant, preventing an agreement from being reached.

A labor union flag is hung at the Samsung BioLogics plant in Yeonsu District, Incheon. Yonhap News Agency

According to industry sources on October 1, labor and management at Samsung BioLogics held the third post-mediation session earlier that morning but were unable to find common ground on major issues. These included wages, employee benefits, and collective bargaining clauses related to management and personnel rights, ultimately ending negotiations.

During the session, both sides reaffirmed their differing stances on a wide range of topics, including wages, bonuses, and overall compensation and benefits. The union is demanding a total wage increase of 9.5%—comprising a 6.5% base salary increase and a 3% performance-based raise—along with a fixed payment of 3 million won. In contrast, management proposed a total increase of 6.2%.

With regard to the restructuring of the bonus system, the union is demanding that the source of the performance-based bonus (PS) be changed to 15% of operating profit with the removal of payment caps. Management, on the other hand, insists on maintaining the current system, under which 20% of Economic Value Added (EVA) is used as the PS source.

The two sides also differ on the perceived level of compensation. The union claims the company’s compensation lags about 15% behind that of competitors. Management, however, argues that if the 6.2% wage increase is adopted, the company’s total per-employee compensation this year will surpass that of competitors.

Significant differences also persist on the collective bargaining agreement, which has been the most contentious issue. The union is demanding prior consultation in matters like organizational restructuring and personnel evaluation. Management contends that many of these demands infringe on the company’s inherent rights to manage personnel and overall business, making them difficult to accept.

Even though management presented an additional proposal, the parties failed to reach an agreement, prolonging the current stalemate. As part of the latest round of negotiations, the company introduced a new plan to subsidize interest on loans taken out by employees to acquire company stock. This plan would provide interest support for one year, with the management’s estimated maximum financial commitment reaching approximately 29.9 billion won. Assuming an annual interest rate of 5%, the average benefit per employee would be around 5.2 million won.

Since no date has been set for the fourth round of post-mediation talks, the union is considering launching collective action. However, the union has expressed willingness to return to the bargaining table before any such action if management continues to demonstrate a genuine commitment to dialogue by presenting additional proposals. The union stated, "If management shows a substantive willingness to engage in dialogue and offers additional proposals in the interest of a smooth agreement, we are ready to participate at any time and in any form."

A Samsung BioLogics management representative said, "We have presented the best possible proposals regarding collective bargaining, wages, and benefits," adding, "We will continue to keep the communication channels open with the union and work toward finding a resolution going forward."

This content was produced with the assistance of AI translation services.