Sanofi-Aventis Korea’s labor union embarked on industrial action on Tuesday, as the wage negotiation with the management failed to narrow differences.

According to the union, it has requested the management to reflect on the company’s improved sales performance last year on deciding this year’s wage hikes. However, the management sticks to the 1.5 percent increase in keeping with the inflation, as the company’s headquarters instructed.

The labor and management have held eight rounds of collective bargaining but failed to reach an agreement. The union applied for mediation with the National Labor Relations Commission (NLRC) but failed to reach an agreement.

“As of May 11, the NLRC mediation fell through as the union and the company management failed to reach an agreement,” union leader Park Young said to Korea Biomedical Review. “The union suggested that the company's sales performance grew by about 7 percent even during the Covid-19 era, and suggested a wage increase of 7.6 percent after considering various price indicators and interest rate hikes.”

After the NLRC mediation began, the union lowered its demand to about 4 percent, but the management would not budge an inch, according to union officials.

“We can’t understand why executives at Sanofi-Korea won’t tell the global headquarters about what we achieved here,” Park said. “Despite major achievements, we can’t receive a reasonable compensation due to guidelines from the global headquarters.”

Park stressed that if they accepted the global guidelines this time, there would be no reason for the union's existence and that they would have to continue accepting the headquarters guideline in the future.

“As the NLRC mediation fell through on May 11, the union secured the right to go on a strike with the 97 percent support of unionized workers at our general assembly,” Park said, adding that the union would continue to hold a protest in front of the office.

If the two sides fail to compromise, unionized workers will strike next month.

However, Sanofi Aventis Korea said the company would continue wage negotiations with the union.

“Although there is a difference of opinion between the two sides, we will do our best to engage in negotiations with sincerity and to negotiate smoothly,” a Sanofi Aventis Korea spokesperson said.

The ongoing dispute is the second labor-management conflict this year.

In April, the union filed a lawsuit against the company's general manager and human resources head for failing to pay overtime allowances.

The union filed a lawsuit on behalf of four unionized workers for violating the Labor Standards Act by improperly operating the flexible working hour system outside the workplace and not providing overtime pay.

The union estimates their unpaid wages amount to 11 million won ($8,691).