President Lee Takes Aim at Samsung Union: "I Don't Understand Dividing Operating Profit Before Taxes Are Even Deducted"

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[Financial News] President Lee Jae Myung criticized the Samsung Electronics labor union, which has threatened a general strike, saying on the 20th, "They want to systematically divide a certain share of operating profit before even deducting taxes, which are the common share of the people. Even investors cannot do that. Investors receive dividends from net profit after taxes are deducted, so I find it somewhat hard to understand."
At the State Council of South Korea and Emergency Economic Review Meeting he chaired at Cheong Wa Dae that day, President Lee stressed, "The ones who receive a share of corporate profits are shareholders."
He added, "It is good that some labor unions negotiate collectively through the right to organize and the right to collective action, and work to secure their interests, but I think there must be a reasonable limit."
He continued, "The reason rallies are allowed is to protect individual dignity through free expression and to preserve a free social order as a whole. But they must not be abused or misused in a way that causes serious harm to others by going beyond that reasonable limit."
He also said, "Likewise, the three labor rights are meant to protect workers, who are socially vulnerable, and the principles of solidarity and responsibility are very important. They are not a form of force granted so that a few individuals can collectively secure only their own interests. They are a constitutional device to restore balance of power for the vulnerable and maintain an appropriate social equilibrium."
President Lee emphasized, "There are many stakeholders involved in a company. There are investors who bear risk and losses, and because they do so, they naturally have the right to share in the profits. That is the essence. Workers must be guaranteed fair compensation for their labor. Of course, creditors must be able to recover what they are owed, consumers must be protected, and related business ecosystems must also be safeguarded." He added, "No one should unilaterally cross the line."
In particular, he noted, "It is the government's major role to help members of society respect reasonable boundaries and freely exercise their rights and expression within those boundaries. But when those boundaries are crossed, everyone must fulfill their responsibilities for the sake of the broader community." He also pointed out, "Many areas of society seem to be becoming quite extreme these days. There is not much middle ground. Too many people are crossing the line."
His remarks are being interpreted as a criticism that the Samsung Electronics labor union's demand for performance bonuses equal to 15% of operating profit goes beyond common sense. They are also being read as a signal that the government could invoke emergency arbitration powers to force an end to the union's industrial action if it launches a real general strike on the 21st.
Earlier, the National Labor Relations Commission announced that the second post-facto mediation between Samsung Electronics and its union had collapsed. The Samsung Electronics labor union has already warned that it will begin a general strike on the 21st. The union has argued that 15% of semiconductor operating profit should be paid as performance bonuses, with 70% of that amount shared across the entire semiconductor division and the remaining 30% distributed by business unit according to performance.
cjk@fnnews.com Choi Jong-geun, Seong Seok-woo Reporter