Samsung cross-enterprise union chief apologizes for strike threat, says Honam investment requires labor talks

Choi Seung-ho, chairman of the Samsung Electronics branch of the Samsung Group cross-enterprise labor union, said Tuesday he was sorry for having raised the possibility of a strike during bonus negotiations with management.

He also said Samsung Electronics' planned semiconductor factory investment in the Honam region — covering Gwangju and South Jeolla Province — requires consultation with the union, since it would affect workers' employment conditions.

Appearing as a witness at the National Assembly's audit of the Ministry of Trade, Industry and Energy on Tuesday, Choi said the bonus negotiations "were not conducted on the premise of a strike" and expressed regret for having implied otherwise.

He pushed back, however, against a Ministry of Employment and Labor guideline suggesting that performance bonuses linked to company profits are difficult to classify as a subject for industrial action. "The distribution of a company's performance is something that labor and management can fully discuss at the bargaining table," he said.

When asked whether setting the size of a bonus pool — such as a fixed percentage of operating profit — falls within the domain of management decisions, Choi said, "I believe a company's performance is something achieved together by the company and its workers," adding that the matter was therefore open to negotiation. He held his ground on the question of pool size as well, saying it was "something for labor and management to discuss together."

On the point that bonuses paid in company shares require a shareholder vote under commercial law, Choi acknowledged that union members were already aware of that requirement, but drew a line on what would happen if such a vote failed, saying it would be "a matter for labor and management to discuss."

On the Honam semiconductor factory investment, Choi said, "Investment is a management decision," but added, "I believe the resulting changes to working conditions must be discussed with the union."

When pressed on whether the union was opposing national industrial development or balanced regional growth, Choi said, "We are not trying to hold back national industry. I also believe balanced development is necessary." He maintained, however, that "any aspect that could affect workers' conditions must be discussed between labor and management."

Earlier, when Samsung Electronics announced its decision to invest in a semiconductor factory in the Honam region, Choi had said management itself found the plan burdensome and called for the union to be consulted on the investment.

Asked whether he had known about the Honam semiconductor investment plan in advance, Choi said, "The truth is I did not know at the time," adding that "there are aspects that are difficult to speak to because opinions vary."

He also declined to answer a question about whether an internal Samsung report had concluded that Gwangju and South Jeolla Province were unsuitable for the project due to concerns over power supply, water and labor, saying it was "not an area I am in a position to comment on."

Lawmakers also raised questions about the bonus gap between Samsung's DS division, which handles the semiconductor business, and its DX division, which covers home appliances and smartphones.

Choi said the agreement was reached through joint negotiations and proper procedures, and that the DX division's business difficulties had also been discussed.

On the suggestion that the DX division had been left out of the negotiated gains, Choi said one of the union's demands had been greater transparency in the bonus system, and that "an agreement was reached to allow the system to be changed for the DX division as well."

Lawmakers also raised allegations that the union had contracted about 370 million won ($272,000) worth of rally vests from a company run by Choi's father-in-law. Choi said the matter was "under investigation" but pledged to "properly establish standards and procedures for the union's internal operations."

Closing his testimony, Choi said, "As union chairman, I will work to build a more mature labor-management relationship," and pledged to "improve areas that have yet to be systematized and strive to be a cross-enterprise union leader at the forefront of mature labor-management relations."