[Edaily Reporter SOYEON KIM ] The labor-management conflict at SamsungElectronics is escalating. With the labor unions of SamsungElectronics’ Semiconductor (DS) and Digital Devices (DX) divisions effectively split, the conflict has escalated to mutual slander, verbal abuse, and even a battle over petitions. The conflict, which erupted over the distribution of this year’s performance bonuses, is now spreading to include member defections, union reorganization, and a dispute over next year’s wage negotiation process.

◇ DS Aligns with the Inter-Corporate Union; DX with the Donghaeng Union

According to industry sources on the 20th, various allegations have been raised one after another regarding Chairman Choi Seung-ho’s use of union dues at the SamsungElectronics Branch of the Samsung Group Inter-Company Labor Union (Inter-Company Union), SamsungElectronics’ largest union.

Chairman Choi became embroiled in a conflict-of-interest controversy after it was revealed that he had signed a supply contract with a company operated by his father-in-law during preparations for this year’s rallies. Chairman Choi explained that he entered into the contract after comprehensively considering the company’s quote and delivery schedule, and that he derived no personal financial gain.

In addition, allegations have surfaced that credit card benefits—such as mileage and points—accrued from payments made using union funds were attributed to Chairman Choi personally. Lee Song-i, vice chair of the Inter-Company Union who has been in charge of the union’s accounting, raised these allegations by disclosing payment records totaling hundreds of millions of won and announced plans to refer the matter to investigative authorities.

As Vice Chairwoman Lee has raised a series of allegations against Chairperson Choi, the internal conflict between the DS and DX factions within the Inter-Company Union is also coming to the surface. The conflict between DS and DX, which began over performance-based bonuses, has escalated into a war of revelations within the union leadership. Currently, the SamsungElectronics union is effectively divided into the Inter-Company Union, centered on the DS division, and the Donghaeng Union, centered on the DX division.

This shift is clearly reflected in the union membership composition. As of the end of August, 68.4% of DS division employees were members of the Cross-Company Union. In the DX division, however, the figure stood at just 1.0%. The proportion of DX employees in the Inter-Company Union plummeted from 28.1% at the end of March to 1.0% at the end of August. In contrast, 60.5% of DX employees are members of the Donghaeng Union, while the figure for the DS division stands at 0.8%.

The Inter-Company Union is accelerating its transition into a semiconductor-focused union. It held a no-confidence vote against Lee Song-i, Vice Chair of the Inter-Company Union, and Lee Won-il, Chair of the Inter-Company Union’s Gwangju Chapter—both currently assigned to the DX division—which passed with 95.7% and 96.2% approval, respectively. A bylaw amendment restricting union membership to workers in the DS division was also passed with 96.3% approval. This is interpreted as a move to oust even the very few remaining DX employees.

The dispute surrounding the union “blacklist” incident is also fueling the conflict between the two sides. Chairman Choi and others were recently referred to prosecutors on charges of using the personal information of SamsungElectronics executives and employees to compile a list containing details such as union membership status. In response, the Inter-Company Union is pushing for leniency for Chairman Choi, while the Donghaeng Union—centered on the DX division—is collecting petitions calling for severe punishment. The Donghaeng Union has secured over 15,000 signatures, while the Inter-Company Union is aiming for approximately 30,000 signatures. As inter-division tensions escalate, mutual slander and verbal abuse are also intensifying.

◇ Standoff Continues Over Next Year’s Wage Negotiations… Concerns Over Prolonged Conflict

The standoff over wage negotiations also continues. The Donghaeng Union argues that the DX division’s voice was not sufficiently reflected in this year’s wage negotiations and is demanding joint negotiations between DS and DX. Since the 18th, the union has launched an indefinite relay sit-in near Chairman Jay Y. Lee’s residence in Hannam-dong, Seoul, demanding direct dialogue with him.

The Inter-Company Union is pushing for separate negotiations with the DX division starting with next year’s wage talks. Citing conflicts that arose during this year’s joint negotiations, as well as differences in business performance and working conditions between divisions, the Inter-Company Union has stated that it will not form a joint negotiating team next year and will instead proceed under a single-union negotiation system. Given the extreme nature of the conflict between the two unions, it is realistically difficult for either to secure a majority on its own, and the unions’ momentum for their campaign is expected to wane further in the future.

Concerns are emerging both within and outside the business community regarding the prolonged labor-management conflict at SamsungElectronics. With conflicting interests based on age and job category, there are fears that SamsungElectronics’ signature “One Team” organizational strength—a hallmark of the company’s past—could weaken. A former SamsungElectronics executive stated, “The fact that SamsungElectronics’ semiconductors, TVs, and smartphones rose to the top of the world was, above all, due to the unified organizational strength that came from rallying under the Samsung name,” adding, “Now is the time when the ‘One Team’ competitive edge is needed once again.” There are also many who point out that Samsung needs to overhaul its performance-based pay system to better reflect the current times.