Measures include higher partnership subsidies and skilled-worker savings scheme; company proposes voluntary remedies amid Fair Trade Commission probe
Samsung Heavy Industries has unveiled an 11.3 billion won ($7.44 million) package of measures to improve its trading practices with subcontractors, including higher partnership subsidies, new holiday travel and vacation allowances, and a skilled-worker savings program.
The company drew up the voluntary remedies to strengthen cooperative ties and improve trading practices while under investigation by the Korea Fair Trade Commission over delayed issuance of written contracts in subcontracting transactions.
The Fair Trade Commission said Wednesday it had decided to open consent order proceedings in response to Samsung Heavy Industries' application over alleged violations of the Subcontracting Act.
Under a consent order, a company proposes its own remedies for victim relief and trading-practice improvements; if the Fair Trade Commission finds the proposal acceptable, it closes the case through swift implementation of those remedies without ruling on whether a violation occurred. Samsung Heavy Industries had been under investigation for issuing written contracts to in-house subcontractors after work had already begun on ship processing operations. Rather than contest the legal findings, the company applied in December to open consent order proceedings in order to improve its subcontracting relationships and strengthen cooperative ties.
As part of its proposed trading-practice improvements, Samsung Heavy Industries offered to overhaul its contract management system, adopt standard subcontracting agreements across the board, provide training for employees and partner companies, and establish a standing consultative body between the prime contractor and subcontractors.
The 11.3 billion won package includes an increase in partnership subsidies of 3.05 billion won per year, new holiday travel and vacation allowances worth 5.25 billion won annually, a 2 billion won skilled-worker savings program, and a 1 billion won top-up to the existing 2 billion won joint labor welfare fund. The skilled-worker savings program is designed so that a worker who contributes 1.6 million won receives 8 million won in return.
The Fair Trade Commission determined that Samsung Heavy Industries' proposed remedies met the requirements for opening consent order proceedings. The case is only the second time consent order proceedings have been initiated under Article 3 of the Subcontracting Act, which governs the obligation to issue written contracts and retain related documents in subcontracting transactions. The first was against five entertainment companies in June 2025.
y2k@heraldcorp.com
