Samsung Biologics' Plant 4. [Samsung Biologics]
Samsung Biologics' Plant 4. [Samsung Biologics]

Samsung Biologics and its union have agreed to enter a post-mediation process through the labor commission, ending more than 100 days of standoff in the company's first-ever strike. The agreement reflects a shared sense of urgency that prolonging the dispute would inflict irreversible damage on both sides — a fight with no winner. With both parties now pursuing a formal exit strategy, expectations are growing for a resolution and a return to normal production before year's end.

According to industry sources Tuesday, the agreement came after management proposed the post-mediation process and the union accepted. Post-mediation is a system under which the labor commission re-enters as a mediator by mutual agreement when a dispute drags on after the standard conciliation process has concluded. The two sides have formally filed a post-mediation application with the Incheon Regional Labor Commission and plan to reach a final settlement this year after one to two months of intensive negotiations.

Samsung Biologics posted record quarterly earnings in the second quarter, with consolidated sales of 1.32 trillion won ($934 million) and operating profit of 586.4 billion won, driven by full operation of Plants 1 through 4 and a favorable exchange rate. Starting in the third quarter, however, the company faces a significant headwind as production losses of about 150 billion won stemming from the April–May strike begin to hit the books. Losing much of the first half of the year to wage negotiations and strike action is a painful setback amid intensifying global competition in the contract development and manufacturing organization business.

The union, too, appears to have concluded that launching a second full-scale strike would yield little benefit. Public criticism of what many have called excessive compensation demands — including a bonus tied to a fixed share of operating profit — has become a growing burden. The union has sought a 14.3 percent base pay increase, a 30 million won incentive payment and a performance bonus equivalent to 15 percent of operating profit. The demands drew widespread criticism, particularly given that even Samsung Electronics' chip division, which enjoyed a semiconductor boom, set aside only 10.5 percent of operating profit for its special performance bonus pool.

Adding to the union's pressure, a pending appellate court ruling on an injunction against industrial action could narrow the scope of its right to strike. The emerging consensus within the union is that continuing its work-to-rule campaign to preserve its standing while pursuing a pragmatic compromise is the most realistic path forward.

Even amid these pressures, Samsung Biologics is pushing ahead with global expansion and portfolio diversification. The company plans to open a European sales office in Amsterdam in the third quarter, completing a global sales network alongside existing offices in New Jersey and Tokyo. It is also accelerating its next-generation modality expansion through the planned acquisition of Swiss Polypeptide Group for about 2.7 trillion won, securing entry into the peptide CDMO market for key ingredients used in obesity and diabetes treatments.

In the post-mediation process, the central challenge will be narrowing the gap on wage increases while resolving a deeper dispute over union demands for a say in management decisions. Beyond pay, the union is demanding that the company notify and obtain prior union agreement before making major investment and business decisions — including domestic and overseas mergers and acquisitions, spinoffs, factory sales, business unit consolidations and the establishment of new subsidiaries. The union is also pushing to enshrine prior union consent over hiring, promotions and broader personnel management as binding terms in the collective agreement. Management and the broader business community have drawn a firm line, calling such demands a clear overreach into core management prerogatives, and have proposed instead that disputes be referred to a neutral third-party expert body.

"With major business expansion milestones ahead — including the ramp-up of the Rockville factory in the United States, the launch of Plant 5 and the broadening of global order-taking hubs — resolving labor risk early and restoring customer confidence is the most urgent priority," an industry official said. A Samsung Biologics spokesperson said the company "will continue to engage in negotiations sincerely and in good faith."


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