Samsung is trying very hard to prevent the workers from stopping work, and they are having a final round of discussions to avoid the May 21st strike, which would affect chip supplies. An 18-day strike would be a big test for Samsung as the biggest chipmaker in the world, and JPMorgan Chase thinks it could decrease their annual profit by more than 40 trillion won (about $28.76 billion).
What is at stake for Samsung and the chip market
If the work stops for a long time, it would be only the second strike in the company’s history, but much, much bigger than the first one. People in the industry estimate that 30,000 to 40,000 workers will join in, a big jump from 2024 when only around 15% took part.
This increase in numbers is important for more than just Korea. If Samsung makes fewer goods, it could cause issues with getting semiconductors all over the world at a time when companies making AI, phones, and servers are planning how much they’ll need. If there aren’t enough chips, Samsung’s competitors will have an advantage while Samsung deals with its expenses and its workers.
Where talks stand now
Talks started up again on Monday. The National Labor Relations Commission is helping with these talks after a previous attempt to find a solution. By 3pm local time, they hadn’t found an agreement, and with only a few days left, things were still tense.
This current stage of talks is legally the same as a formal agreement between employer and employee if they do reach a deal. Labor Minister Kim Young-hoon said that his work got both sides talking again, and added that, “finding a solution won’t be easy, but it might be closer than we think.”
The core dispute: bonuses and long-term costs
The union wants Samsung to get rid of the limit on bonuses and to put 15% of the operating profit into a fund for performance bonuses. Samsung management has responded with what they call a special payment plan which they say is better than what other companies in the industry offer.
The disagreement is about both money and principles. The people in charge at Samsung say that removing the bonus limit permanently would be hard to continue. Because Samsung Electronics is expected to have around 300 trillion won (approximately $204 billion) in operating profit this year, some workers in the chip department could get nearly 600 million won (about $420,000) each if the union gets their way.
Scale of potential walkout and recent history
The situation with the unions is different now than during Samsung’s first ever strike in 2024. At that time, the National Samsung Electronics Union had about 32,000 members, and not many of them went on strike, which meant production didn’t slow down much.
Now, the larger group of unions has around 73,000 members. The union has said it will fully strike from May 21st to June 7th. This 18-day strike could cause losses of many trillions of won, according to predictions, and this is putting a lot of pressure on Samsung’s management to find a compromise.
Key numbers to watch
Here are the figures framing the negotiation stakes:
– Strike window: May 21st to June 7th
– Potential participants: 30,000 to 40,000
– Union coalition size: around 73,000 members
– Bonus pool demand: 15 per cent of operating profit
– Profit projection: up to 300 trillion won
– Per-employee payout: nearly 600 million won
– Profit risk: more than 40 trillion won
What comes next
There isn’t much time left. If the discussions fail this week, Samsung will have a second strike in its history, and this one will affect a much larger number of people than the one in 2024. Samsung’s offer of a special payment shows they are willing to change, but the union’s demand to officially remove the cap on bonuses is still the main issue.
From a strategic point of view, the outcome will show how Samsung will balance rewarding employees for doing well with keeping their costs under control. In the short term, customers and competing companies are seeing if Samsung’s production schedule will be delayed. In the long term, the way bonuses are decided could affect whether Samsung keeps its talented employees, how much profit they make, and how well Samsung does in the important computer chip market.
