MSD Korea recently announced it would abolish the General Medicine (GM) business responsible for its diabetes treatment and recommended voluntary retirement for about 100 executives and employees.
In response, its union rejected the plan altogether and vowed to struggle against it.
On May 9, MSD Korea declared the transfer of the sales right of its diabetes drug Januvia Tab. (sitagliptin) portfolio to Chong Kun Dang, making the abolition of its GM unit official.
The management proposed voluntary retirement for about 100 executives and employees in the department. It then offered to pay basic severance pays equal to twice the number of years of service plus 10 months and an additional bonus of 20 million won ($14,920).
However, it restricted the maximum payment limit of basic severance pay to a “basic monthly salary of up to 48 months.” Those with 19 years or more of service periods and less than four years left before retirement will face limits to basic retirement benefits.
The resignation date for voluntary retirees has been set at July 31. The company has decided on the deadline for the GM department, considering Chong Kun Dang will begin to sell Januvia on July 15.
MSD Korea’s labor union maintains that it can never accept personnel trimming. The union is vehemently opposed to the plan, claiming the company’s decision violated the Labor Standard Act and the collective agreement signed between the management and labor.
“The Articles 4, 7, 17, 23, and 24 of the Labor Standards Act have a stipulation for the workers’ self-determination right on working conditions to protect workers, prohibition of forced work, the obligation of employers to specify working conditions, prohibition of unfair dismissal, and restrictions on dismissal due to management reasons,” the union said. “The union and all its members will fight strongly with all their capabilities available to protect the right to life, according to the Labor Standards Act and Article 18 of the Korea MSD Collective Convention stipulating ‘employment security.’”
The union said it “would not participate in all sessions, including the one-on-one meetings, planned by the management.”
Industry insiders predicted that the labor-management conflict within MSD Korea would intensify as the union strongly opposed the management’s workforce reduction plan and rejected the latter’s early retirement program.