Samsung Biologics strike talks stall as losses mount

Negotiations between Samsung Biologics and its labor union failed to yield a breakthrough Monday, as both sides remained far apart during government-mediated talks aimed at ending the company’s first full-scale strike.

Representatives from management and the union met at a mediation table set up by the Ministry of Employment and Labor, but could not reach an agreement by the day's end. The two sides plan to carry out two more rounds of talks on Wednesday and Friday.

According to the union, management urged workers to halt all strike actions without presenting a concrete proposal. The union also criticized the company for not sending key decision-makers, noting that senior executives such as the CEO and the head of human resources were absent from the talks.

“Considering the graveness of the current situation, the decision-making power and responsibility between both sides’ participants are not on the same level,” the labor union said in a statement.

“Unless the management presents practical offers and decision makers, today's conversation alone will not end this situation.”

The labor union added that it plans to carry on the five-day walkout through Tuesday, noting that it will switch to a work-to-rule mode afterward to carry on the protest within the boundaries of law. Some 2,800 workers, a little over half of the company’s entire workforce, have participated in the full strike since Friday, according to the union.

Losses are mounting for Samsung Biologics, while the company has rapidly expanded its contract-based businesses in recent years amid soaring demands for biopharmaceutical manufacturing orders worldwide.

The CDMO firm initially estimated that the five-day full strike will result in a loss of at least 640 billion won ($435 million), which would exceed its operating profit of 580.8 billion won from the first quarter this year. The company said it had taken a loss of 150 billion won so far as it pulled out all the stops to minimize the damage.

The company logged record sales of 4.56 trillion won and record operating profit of 2.07 trillion won last year, approximately a fourfold and a sevenfold growth, respectively, from 2020.

The walkout marked the company’s first strike since its foundation in 2011. Despite 13 rounds of negotiations and two meetings involving the CEO, management and the union failed to reach an agreement before mediation fell apart on March 23.

Samsung Biologics’ labor union has demanded a 14 percent average wage increase, a 30 million won cash payout per worker and a bonus equivalent to 20 percent of operating profit. On the other hand, the company said the union’s requests were unrealistic, considering the company’s ability to pay and secure financial resources for future growth.

Vowing to do its best to bring peace to the workplace again, Samsung Biologics said it will bring out all measures to minimize damages to its clients and future losses.