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Tuesday, January 18, 2005

Samsung and Nokia

Samsung and Nokia, two flagship companies of their respective countries, Republic of Korea and Finland: both hold an important position in the economy of the respective countries, and the companies have also largely contributed to the contemporary image of these two nations. The owner-director of Samsung, Lee Kun-hee and the CEO of Nokia, Jorma Ollila are statesman-level figures. As the both companies have enjoyed in their home countries and internationally a lot of respect and admiration that, there hasn't been a shortage of criticism especially in the case of Samsung concerning its stern (and successful) opposition against organization of labor and it's allegedly paralegal (?) methods of transferring the ruling and ownership rights to the next generation - all this in addition to the general negativism towards the inequal division of wealth, very well marked by the riches of conglomerate chaebôl / jaebeol) owner-manager families. (This doesn't prevent Samsung being the most favored employee for young educated job-seekers, as is the case of Nokia in Finland as well.)
The founder of Samsung, Lee Byung-chull, is said to have said that "as long as earth doesn't cover my eyes, there won't be a labor union in Samsung". It was almost a week ago that Ohmynews had a story on the case of Samsung Electronics making a worker who had become a union member an offer he couldn't refuse. Not that the worker in question, Mr Hong, had attempted to launch an union in Samsung Electronics, but he had joined the Metal Workers Union (금속노조). One month later he was called to a discussion, in which he was informed, after being questioned who his family is doing, that if he going to continue union activities, he'll have to abandon his family (가족을 버려야 하다) and leave the company without any severance pay. He was also promised good support (chiwôn) from the company if he withdraw from the union. The person didn't like withstanding the pressure, and signed a paper stating withdrawal from the union. Immediately after that he was told that a person who has joined a union has worked against the Samsung company principles (kyôngyông inyôme paechidoenûn sago), and cannot work for Samsung any more. After five hours of persuasion and threats (hyôppak), Mr Hong ended up getting 100 million won extra severance pay on top of the customary sum, 2.5 billion won (2억 5000만원) alltogether.

The Ohmynews story accounts the press conference that Mr Hong had in the company of Tan Pyông-ho (spelling?), the MP of Democratic Labor Party and a long-time labor activist. Mr Hong had received a text message from Samsung the day before, asking him to visit the company with his CV precisely at the time of the press conference. Representative Tan remade the infamous Lee Byung-chull quote in the following way: "as long as earth doesn't cover my eyes, I'll struggle against the unacceptance of unions by Samsung."

So what is Nokia doing with Samsung in the title of this post? Isn't Finland a heaven for union and labor activities compared to Republic of Korea? If not heaven (some strong labor unions in Korea seem to have a much stronger negotiation position than any Finnish union could dream of), the overall position is surely better (but not improving). Yesterday an investigative TV program aired a 30-minute program on the labor practices of Nokia Corporation with the title "Nokian laki" (Nokia's Law) (Script in Finnish; rough English translation of the script). It's about Nokia giving a hard time especially to "shop stewards" (employees' representatives), who according to the program are able to do their representation tasks in other big companies relatively free of problems (from the part of the company).
From the English translation of the script:
Mattila (employee representative): I’ve been thinking about this and come up with this idea that the employers’ union uses Nokia as a testing ground. They think that Nokia is so successful and appealing as a company that the employer can treat those who are not key personnel as they please.

Kiiras (lawyer of the professional and managerial employee union) : They don’t brake the law routinely. No, no, you should not portray them like that. You have to remember that this is about young managers, people who do not know what they’re doing, people who make mistakes, so then it sometimes happens that you brake the law. But when we talk about the position of shop stewards, then there’s maybe a bigger thing behind.


A couple of more pieces from Ohmynews which nicely illustrate the kinds views there are in Korea towards Samsung.
"I worked for two months for the Lee Kun-hee reception team"; a piece written by a Korean student in Germany about working for Samsung in preparing chairman Lee's vacation visit to Germany. Some interesting pieces of information how the German office of Samsung prepared for two months for the chairman's visit, and how actually quite little of what was done was finally utilized by chairman Lee. The writer describes it as "overloyalty" (kwaing ch'ungsông). Quite interesting if Samsung did not made him to sign a pledge not to reveal anything he learned about the company during the stint. Heck, I accompanied a small group of Nokia personnel in Seoul for 3-4 days, and I needed to sign that kind of a pledge.
• "Foreigners collecting tens of trillions"; lamenting and worrying that foreign owners of Samsung shares are collecting so much in dividends (paedang) as Samsung Electronics had such a good last year. Money that a Korean company has been earning is going out into the hands of foreigners who have acquired so much of Samsung stock!

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