Strike at Samsung Electronics: Unions in South Korea are getting louder

HWASEONG: Samsung Electronics employees began a three-day hit for better pay on Monday, with their union pointing to further measures South KoreaThe world’s largest conglomerate is still unable to meet its demands.
The National Samsung Electronics Union The National Electricity Union (NSEU), whose approximately 30,000 members make up almost a quarter of the company’s South Korean workforce, is also demanding an additional day of vacation for union members and a change to the bonus system for its employees.
Due to low turnout and automated production, the strike is unlikely to have a significant impact on production at the world’s largest memory chip maker, analysts said. Still, it signals a decline in employee loyalty at a crucial time in the chip industry as technology companies embrace artificial intelligence.
The union’s first industrial action last month was to coordinate annual leave to organize a mass strike. Samsung said this had no impact on business operations. The company declined to comment on Monday’s strike.
The union, which did not disclose its involvement last month, said 6,540 workers are striking this week, mostly in manufacturing plants and product development. The strike also affects workers who oversee automated production lines and equipment, so operations could be disrupted.
Union officials said about 3,000 strikers took part in a rally in the rain near Samsung’s headquarters in Hwaseong, south of Seoul.
Union president Son Woo-Mok denied media reports of low turnout and told Reuters that the five-year-old union had not had enough time to train its members.
“Education about unions … has not been enough. But I don’t think participation is low because our union is still young compared to other unions,” he said.
Lee Hyun-Kuk, the union’s vice president, said there could be more strikes if Samsung does not improve its proposals.
While Samsung’s proposals included more flexible pay and vacation terms, they would not meet unions’ demands for higher wages and vacation entitlements, Lee told Reuters.
Union representatives also want equality in the bonus system. They said bonuses for ordinary workers would be calculated by deducting capital costs from operating profits, while bonuses for managers would be based on personal performance targets.
“I’ve told people I’m proud to work at Samsung, but the truth is that’s not the case,” said Park Jun-Ha, 20, an engineer on Samsung’s chip packaging lines who joined the company in January. He added that he was unhappy with the company’s “opaque” bonus system.
The union’s membership has grown since Samsung pledged in 2020 to stop discouraging unions. Their growing voice demands attention just as Samsung struggles to compete for chips for artificial intelligence (AI) applications, analysts say.
Samsung’s share price performance has lagged behind that of chip competitor SK Hynix. Union officials blame Samsung’s AI problems on the slow development of high-bandwidth memory (HBM) chips, which are in high demand for use in AI processors.
Nevertheless, Samsung on Friday estimated that its operating profit would increase more than 15-fold in the second quarter as the recovery in chip prices driven by the AI ​​boom pushed earnings up from a low comparable base a year ago.
The stock rose 0.2% in afternoon trading on Monday, having risen as much as 1.72% earlier in the session to its highest level since January 2021. Last week, it rose 6.9% after preliminary quarterly results beat analysts’ estimates.