Amid a protracted labor conflict at MSD Korea due to the company’s decision to abolish its general medicine (GM) division, the management has expanded the eligibility for its early retirement program (ERP) while increasing compensation money.
MSD Korea recently announced the expansion of the ERP to all employees.
Previously limited to employees in the GM division, the program was expanded to include the business unit and the commercial operations (CO) division. The company also sharply revised the package and will receive applications from July 10 to 20. The original ERP offer closed on June 30, but the company has revised the terms and conditions and will accept applications for an additional 10 days.
In the new package, the basic severance money remains unchanged from the previous offer -- "2N + 10" (N is the number of years of service), with a maximum payout of up to 48 months of monthly base salary.
However, the management has sharply raised the additional retirement consolatory benefits. The previous proposal was a lump sum payment of 20 million won ($15,380) regardless of the number of years of service. However, in the package, the amount has been increased to 70 million won for those with less than five years of service, 100 million won for between five and 14 years of service, and 120 million won for the service of 15 years or more.
Besides, 20 employees who applied early will receive an additional 10 million won. The company will also pay an additional 10 million won to GM unit employees who have already applied for it under the previous special ERP.
Effective Aug. 1, 2023, MSD Korea will reorganize its business unit into an anticancer business unit, vaccines business unit, and hospital specialties business unit. It also will terminate the operation of its GM division on July 31.
According to MSD Korea, based on the management strategy of focusing on innovative medicines, the company will further grow the key areas of medical innovation, such as anticancer drugs, vaccines, and new pipelines.
In the process, the company unveiled its decision to implement ERP for all GM division employees without giving the option to move departments, triggering conflicts with its labor union.
“The reorganization was not an easy decision for the company,” a company official said. “Our recognition of and appreciation for the hard work and dedication of our GM employees, who have improved the lives of countless patients in Korea, will not change, and we will continue to support them to the best of our ability.”