• The impending right to strike raises alarms over a "structural supply chain risk" for the 24/7 global biopharmaceutical supply chain.
• The union points to a systemic failure in labor compliance, highlighting a critical gap between public declarations and actual corporate practices.
• Allegations of interference by Samsung Electronics' Business Support Office raise severe corporate governance concerns for the KOSPI-listed CDMO.
• Criminal complaints filed over violations of the collective bargaining agreement and labor relations laws pose significant ESG risks.

The labor dispute at Samsung Biologics, the world’s leading contract development and manufacturing organization (CDMO), has reached a critical juncture. Representing approximately 75% of the company's workforce, the Samsung Biologics Labor Union (President: Jaesung Park) announced today that the ongoing conflict is not merely a wage dispute, but a core business risk stemming from the structural limits of Samsung Group’s opaque corporate governance and labor compliance systems.

Systemic Failure and "Structural Supply Chain Risk"

Entering the legal phase to secure the right to strike in solidarity with the Samsung Electronics union, the union issued a stern warning to the global market. "The absence of an internal system to autonomously resolve recurring conflicts poses a critical structural supply chain risk to our global clients," the union stated. "Management's lack of experience in rational labor relations—stemming from its historic no-union policy—is a systemic failure that directly threatens the uninterrupted 24/7 continuous manufacturing required in the biopharmaceutical industry."

Internal Documents: Unfair Labor Practices and Governance Interference

The union argues that Chairman Jae-yong Lee's public declaration to abolish the no-union management policy remains unfulfilled. This discrepancy is evidenced by internal documents leaked in November 2025. "As extensively covered by South Korea's major broadcaster MBC, these documents revealed evidence of Unfair Labor Practices (ULP) designed to suppress union activities," the union noted.

Beyond ULPs, these documents highlighted a severe corporate governance risk. The union pointed out that Samsung Biologics—an independent KOSPI-listed entity—allegedly operates under a structure where core personnel policies are reported to and approved by Samsung Electronics' Business Support Office. This structural control is further underscored by the fact that Samsung Biologics' top HR executive is a former Samsung Electronics official.

President Park emphasized, "Even if the working-level negotiators attempt to reach a compromise, final decisions are inherently influenced by the Business Support Office. This structural limitation fundamentally blocks autonomous agreements and prolongs the dispute."

Compliance Failures and ESG Risks

The union also strongly condemned management’s compliance failures. Despite a Labor-Management Win-Win Agreement signed on December 1 to resolve a broad array of legal disputes—including aggravated trespassing, violations of the Public Interest Whistleblower Protection Act, and breaches of labor relations laws—the union claims management has failed to honor the spirit of the agreement.

Consequently, the union filed criminal complaints against top executives for violations of the collective bargaining agreement and labor relations laws. "Failing to uphold signed agreements and labor laws directly violates the strict ESG standards demanded by global pharmaceutical companies," the union criticized.

President Park concluded, "Our struggle is to establish proper ESG management and normalized corporate governance. To prevent an uncontrollable supply chain shutdown, management must break free from the group's excessive control and demonstrate responsible, independent leadership."

View source version on businesswire.com: https://www.businesswire.com/news/home/20260323370640/en/

"Management's failure to resolve systemic labor disputes now poses a critical structural supply chain risk to our global biopharmaceutical clients."