South Korean Prime Minister Kim Min-seok stated on Sunday that as the Samsung Electronics strike is about to break out, he is happy to see companies and labor unions restart negotiations and dialogue. At the same time, he warned that the government will take all measures, including emergency arbitration, to minimize the impact of the incident on the national economy. The labor and management sides have agreed to restart government-led mediation negotiations on Monday, just four days before the union plans to launch a strike. Kim Min-seok made the above statement in a public speech to the country.
The differences between labor and management are huge this time, and the focus of the conflict is the performance bonus system linked to the profitability of the company's artificial intelligence semiconductor business. Samsung Electronics' largest union plans to start an 18-day strike on Thursday.
Kim Min-seok said: "The government sincerely welcomes the resumption of dialogue between the two sides. Monday's negotiations are actually the last chance to prevent the outbreak of strikes. Both labor and management must take this talks seriously."
He mentioned that the strike may severely damage the South Korean economy and said: "In order to maintain the country's economic stability, the government has to consider various response methods such as emergency arbitration."
According to the relevant provisions of South Korea's labor law, if it is determined that a strike will seriously damage the national economy and disrupt people's daily life, the Ministry of Labor can initiate emergency mediation measures and suspend the strike for up to 30 days.
Kim Min-seok warned that the impact of this strike is by no means limited to Samsung itself. It will also trigger chain negative effects, including a decline in exports, financial market turmoil, and many cooperative companies will also experience problems such as investment reduction and job contraction. The overall economic loss is estimated to be up to 100 trillion won (approximately US$66.98 billion).
Kim Min-seok said that the South Korean government has convened the second emergency ministerial meeting today to comprehensively study and judge the potential impact of the strike and discuss a full set of response plans. The government will make every effort to promote communication between the two parties and try its best to avoid a strike.
The union has appealed, demanding that 15% of the semiconductor unit's operating profits be set as a fixed performance bonus and that the upper limit on bonuses be cancelled.
Samsung Enterprises proposed to retain the existing bonus system and improve the flexibility of the system by adjusting the accounting method and adding a special compensation plan.
Samsung Chairman Lee Jae-yong publicly apologized last Saturday for causing external concerns about internal conflicts in the company and called for consensus within the company.