Union strike fears disruption of semiconductor production at Samsung Electronics

The National Samsung Electronics Union (NSEU), the largest of Samsung Electronics’ numerous unions, will go on a general strike on July 8. Thousands of NSEU unionists are expected to participate in the strike. The union has warned against continuing the strike indefinitely in the future, raising the possibility of disruption to semiconductor production at Samsung Electronics.

The NSEU will hold a general strike resolution meeting at 11 a.m. on July 8 in front of the main gate of H1 at Samsung Electronics’ Hwaseong Plant in Hwaseong, Gyeonggi Province, Korea, industry sources said. The first general strike will last for three days until July 10, the NSEU said.

The NSEU is demanding a higher wage increase for 855 members who rejected a 5.1 percent basic wage increase for 2024, an improvement in the OPI system based on economic added value (EVA), the fulfillment of promised paid holidays and compensation for unionists for the economic losses they suffered during their unpaid strikes. If management does not comply, the NSEU will launch a second general strike, an NSEU representative said.

As of July 6, the NSEU had a total of 29,913 members, with the majority of them reportedly belonging to the Device Solution (DS) division. While a temporary strike is unlikely to affect semiconductor production at the plant as semiconductor production lines are largely automated, many industry experts say a prolonged strike would deal a severe blow to semiconductor production.

The NSEU also threatened to extend the strike indefinitely. “If the three-day strike hinders production at the plant, the plant will suffer great damage,” warned Son Woo-mok, chairman of the NSEU.

Samsung Electronics is reportedly increasing the utilization of its production lines as the semiconductor market is on the rise. A prolonged strike could affect the production of high-performance D-RAMs such as high-bandwidth memories (HBMs) and NAND products such as enterprise solid-state drives (eSSDs), which are in high demand. In the foundry sector in particular, the Korean semiconductor giant will face a drop in customer confidence if delivery deadlines cannot be met.