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Samsung Electronics Union Calls First-Ever Strike

Image Credit: Reuters

Samsung Electronics Union Calls First-Ever Strike Over Wages

A union representing thousands of workers at Samsung Electronics has called the first strike at the South Korean technology giant over wages, this came after an Executive replacement to address the chip crisis.


BBC reported the National Samsung Electronics Union says it will hold a one-day protest by asking all of its members to use their paid leave on 7 June and has not ruled out a full-scale strike in the future. The union says its has about 28,000 members, accounting for more than a fifth of the company’s total workforce.

Samsung Electronics says it will continue to negotiate with the union. This came after the chip giant replaced its Chief of Semiconductor Division in a bid to overcome a “chip crisis”, amid a booming market for AI chips where the world’s biggest memory chipmaker has lagged peers.

Samsung, appointed Young Hyun Jun, shifting him from the role as Head of its Future Business Planning Unit. Kye Hyun Kyung, who led the semiconductor division since 2022, will swap into Jun’s prior role as Head of its Future Business Planning Unit

The move is likely aimed at catching up in the market for top-end chips used in artificial intelligence such as high bandwidth memory (HBM) chips, an area where Samsung has fallen behind rivals such as SK Hynix, analysts said.

“We can’t stand persecution against labour unions anymore. We are declaring a strike in the face of the company’s neglect of labourers,” a union representative said during a live-streamed news conference.

Samsung Electronics’ management has been in talks with the union since the start of this year over wages, but the two sides have so far failed to strike a deal. The union has demanded a 6.5% pay rise and a bonus pegged to the company’s earnings.

Samsung Electronics is the world’s largest maker of memory chips, smartphones and televisions. Analysts have warned that a full-scale strike could affect the firm’s computer chip manufacturing and impact the global supply chains of electronics.

Samsung Electronics is the flagship unit of South Korean conglomerate Samsung Group. It is the biggest of the country’s family-controlled businesses that dominate Asia’s fourth-largest economy. Samsung Group was known for not allowing unions to represent its workers until 2020 when the company came under intense public scrutiny after its chairman was prosecuted for market manipulation and bribery.

Samsung Electronics’ shares were trading about 2% lower in Seoul after the announcement. The latest movement may spell more turbulence for the South Korean chipmaker on top of the current murky waters it is in now.

 

 

 

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