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Labor Rights Protection

LG Electronics guarantees employees’ basic labor rights including freedom to associate and right to negotiate. It is highly praised for its fine labor-management relationship based on the labor union’s fulfillment of social responsibilities and future-oriented Win-Win Labor Relations.

HUMAN RIGHTS PROTECTION AND PREVENTION OF DISCRIMINATION

LGE recognizes the right of all employees and stakeholders to pursue happiness, to work with dignity and to have their value as human beings respected. Accordingly, LGE complies with the standards established by the UN, ILO, OECD, and other international labor organizations as well as labor laws and regulations. It established and announced Global Labor Policy that contains the values to be shared with all stakeholders in August 2010. The Labor Policy includes a regulation that prohibits forced labor that restrains mental and physical freedom, employing minors below the age of 15, and assignment of dangerous tasks to youths under the age of 18. The Labor Policy further prohibits discrimination based on gender and race, promotes compliance with the maximum working hours set forth by the law, payment for overtime, and contributes towards local economic development. In addition, the policy also guarantees employees the freedom to join a union, as well as to join in the activities of the union and freedom to organize. The Labor Policy has been distributed to all the worksites throughout the world and has been complied with as the LGE labor standards.

GLOBAL LABOR POLICY

In August 2010, LG Electronics has declared its Global Labor Policy. The policy was established as part of LG Electronics’ efforts to advance its management philosophy of “respecting human dignity,” and aims to uphold human dignity and value of all employees in terms of labor. The Global Labor Policy has been translated and distributed in a total of 18 languages including English and Chinese, and LG Electronics plans to realign and operate all of its humanity and labor related processes based on the policy.

Korean/ English Arabic Brazilian/ Portuguese Chinese Czech French Greek Indonesian Italian Japanese Polish Portuguese Russian Spanish Spanish (NA) Thailand Vietnamese German

DIVERSE COMMUNICATION CHANNELS

All employees of LGE are eligible to join and participate in the activities of labor unions, in accordance with the relevant collective bargaining agreements and labor union regulations. As of the year-end 2013, a total of 8,172 employees, representing 21% of our total workforce in Korea, were union members. The union’s infrastructure consists of one head office and six branches throughout the country. All union members have voting rights and are eligible to stand for office. In addition to the quarterly labor-management meeting and annual Collective bargaining, LGE communicates various issues, including working conditions, regularly through diverse channels. Both parties negotiate in good faith and with patience on important agendas to reach an agreement. A prime example is the adaptation of a performance oriented promotion system for production employees that was established in 2010 after 3 years of discussion. Through such efforts, the labor and the management achieved their 25 consecutive year of agreement without dispute, proving LGE’s superiority in labor relations. In addition, LGE also operates the Junior Board to obtain suggestions from both union and non-union members. LGE further makes diverse efforts through various channels to promote effective communication.

Labor-Management Relations at LGE

Labor-Management Communication Structure

GLOBAL WIN-WIN LABOR RELATIONS

In the case of overseas offices, there is higher chance for various labor-management issues to arise due to cultural differences. As a result, LGE has spread the advanced labor-management culture and labor-management know-how to overseas offices as a part of its ongoing efforts to form a global advanced labor-management culture. In 2010, LGE launched the Global Win-Win Labor Relations Project and inspected the labor-management status of subsidiaries in Nanjiang of China, Indonesia, and Poland. LGE advised these office to establish region specific guidelines that reflect their culture and conditions. Continuing on from 2010 and to 2011, LGE a standard labor-management organization both in Korea and overseas and build an even stronger and more systematic labor-management relationship. In addition, LGE is strengthening the global labor management network to monitor and evaluate the labor-management relationship in real-time and assign a Green, Yellow, or Red signal corresponding to the situation

Employee Grievances

In order to protect employees’ human rights, promote workplace satisfaction, and provide a healthy and sound working environment, LG Electronics makes every effort to handle employee grievances in a fair and reasonable manner. To this end, we operate a three-step employee grievance resolution process composed of submission, resolution, and feedback & awareness promotion. We also categorize employee grievances into the following six areas: career development, HR, working conditions, work environment, relationships, and personal matters, after which diverse channels are employed accordingly (e.g. semiannual meetings with the team leader, grievance resolution committee & counseling center, JB Council, Labor-Management Council) to resolve employee grievances in an expedient manner.
At our business sites in Korea, we have also established counseling centers and offer counseling and therapy programs with guarantee of anonymity to actively address various grievances and emotional issues arising from our employees’ personal and professional life. Counseling centers operate a wide range of programs, including individual, group, and family therapy sessions, and employees are required to make an appointment to protect their anonymity. If needed, employees are provided with an interpretation session on the result of their psychological tests, and group sessions are also offered to facilitate the resolution of internal conflicts within a team. In 2013, a total of 4,158 employees and 470 teams participated in individual and group therapy sessions.



Grievances Resolution Process

CSR Risk Management Program

In accordance with the CSR Risk Management Program introduced in 2010, LG Electronics assesses its production sites for their compliance with the Global Labor Policy. In 2013, we conducted the EICC assessment (self-assessment) on our 40 production sites (7 in Korea and 33 overseas) biannually. The number of assessment targets increased to 40 from 37 in the previous year as the assessment was expanded to include joint venture and new sites (Jeonju, Haiphong in Vietnam and Turkey). In the assessment, our production sites averaged 88.25 points, up 1.54 points from 2012 (86.71). The number of production sites rated to be at low risk also increased from 28 (2012) to 33. We plan to increase the number to 37 in 2014, and to lower the risk level of newly included production sites to “low risk” by 2015 through rootcause analyses and intensive management efforts tailored for each individual site.
Based on the self-assessment results obtained in the first half of 2013, our production sites established improvement plans to address the risks identified through the assessment and made voluntary improvement efforts. We also reviewed the progress of their performance through the assessment performed in the second half, and plan to share best practice cases with other production sites. Moving forward, we intend to reward best production sites and relevant staff members to provide further motivation toward improving CSR compliance.
In 2014, LG Electronics plans to make more systematic CSR risk management efforts based on the revised EICC Self-Assessment Questionnaire. The revised questionnaire categorizes risk types based on their inherency, controllability, and management system to help corporations perform more accurate root-cause analysis and formulate effective responses.

USR(UNION SOCIAL RESPONSIBILITY)

The Labor Union of LGE held a declaration event for the Union Social Responsibility(USR) Charter in January 2010. The union has faithfully been complying with the provisions set forth in the Charter and has introduced a new concept of labor union. The union introduced the “Win-Win Labor Relations” based on social responsibilities to the public, and has been making joint efforts with the management to create a healthy and sustainable society.
The LGE Labor Union established a vision for USR as part of its efforts toward goal-oriented and effective USR activities. In order to achieve the vision of "Socially Responsible Labor Union that Provides Innovative Value" the Labor Union focuses on fulfilling USR, improving the quality of employees’ lives and making contributions to the global community as its key role and responsibility. The USR system is constructed based on “ISO 26000 - Social responsibility” (Standards established by the International Organization for Standardization to provide guidance on how businesses and organizations can operate in a socially responsible manner) and organized into the seven core subject areas of Governance, Human Rights, Labor, the Environment, Fair Operating Practices, Consumer Issues, Community Involvement & Development. the LGE Labor Union develops action plans for each core subject and carries out systematic USR activities.

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