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The third round of post-mediation talks between Samsung Electronics management and labor ended without an agreement on May 20 at the National Labor Relations Commission in the Government Complex Sejong. From left, Choi Seung-ho, head of the Samsung Electronics branch of the National United Labor Union; Park Su-geun, Chairman of the National Labor Relations Commission; and Yeo Myung-goo, head of the People Team for Samsung Electronics' DS Division, leave the commission's mediation room. / Yonhap

Samsung Electronics’ management and labor held negotiations until the eve of a full-scale strike, but ultimately failed to reach an agreement as the mediation process fell through. Although neither side disclosed the specific details of the mediation proposal, they reportedly failed to narrow their differences until the very end regarding the distribution ratios across divisions and business units. The union announced that while it had accepted the proposed agreement, management failed to make a decision, leading the union to proceed with the planned strike.

Even as the union exercises its right to strike, both parties have left the door open for further dialogue. The National Labor Relations Commission (NLRC), which mediated the talks, and the Ministry of Employment and Labor still believe a possibility for negotiation remains. The Ministry of Labor particularly refrained from commenting on a potential emergency arbitration, stating, "Time still remains, so we will work to ensure that dialogue takes place."

The NLRC commenced the third round of post-mediation talks at 10:00 AM on May 20 at the Government Complex Sejong. During the second round, which extended late into the previous night, both sides had slightly narrowed their differences, leading NLRC Chairman Park Su-geun to present a compromised agreement. Management immediately began reviewing the proposal. However, as no conclusion was reached past midnight, the mediation deadline was extended. Management spent the following morning reviewing the proposal, but the final mediation ultimately collapsed.

"We presented a mediation proposal; the labor union accepted it, but the employer rejected signing it, citing reservation," Chairman Park stated as he concluded the session. "Consequently, the mediation has ended without success, but re-mediation can be initiated at any time if requested by both parties."

"Management initially rejected the proposal presented by the NLRC yesterday, but they withdrew their rejection right before the mediation collapsed, which extended the schedule to today," Choi Seung-ho, head of the Samsung Electronics National United Labor Union and a union negotiator, stated around 11:40 AM upon the conclusion of the talks. "The union agreed to the NLRC’s proposal, and the mediation fell through due to delayed decision-making by top management."

Samsung Electronics issued a statement regarding the conclusion of the post-mediation process, explaining, "The post-mediation failed because accepting the union's excessive demands would violate our core management principle: 'rewards follow performance'."

Ultimately, the two sides appeared unable to close the gap over performance-based bonus allocation ratios. The union had previously proposed that 70% of excess profits be distributed across the entire Device Solutions (DS) division, with the remaining 30% allocated based on individual business unit performance. Management, however, maintained that since the bulk of excess profits was generated by the Memory Business, accepting the union's proposal would violate its meritocracy principle. Management reportedly countered with a 40% allocation for the entire DS division and 60% based on business unit performance.

While Chairman Park declined to comment on the specific details of the adjustment process, he noted, "The union made significant concessions on that particular item."

Nevertheless, both sides left the possibility of dialogue open. "We made concessions to reach a settlement, and we apologize to the public for failing to produce a positive outcome," Choi stated. "We will participate sincerely if further post-mediation procedures are arranged."

Yeo Myung-goo, head of the People Team for the DS Division and management's chief negotiator, also stated, "We will continue our efforts to maintain dialogue moving forward."

The government also expressed its commitment to facilitating a resolution through dialogue before the strike commences. "This is highly regrettable," Hong Kyung-ui, spokesperson for the Ministry of Employment and Labor, told reporters following the collapse of the mediation. "However, as both sides have stated, time still remains. Under the overarching principle of resolving the issue through dialogue between the concerned parties, the government will provide maximum support without being bound by formalities to ensure it can be resolved through autonomous negotiations."

Spokesperson Hong minimized discussions regarding emergency arbitration, reiterating, "There is still time left for dialogue," and indicating that the government intends to encourage maximum communication before the strike takes place.