SEOUL, March 11 (AJP) - The likelihood of a strike at Samsung Electronics, the world’s largest memory chipmaker supplying about a quarter of global DRAM, is rising as more than 60 percent of its unionized workers have cast ballots on collective action over disputes about employee bonuses.
A joint strike committee representing three Samsung labor unions said Wednesday that over 60 percent of their roughly 90,000 members had participated in the vote since balloting began Monday. Under South Korean law, a strike requires approval from a majority of total union membership.
The largest group, the Samsung Group Unified Union, reportedly surpassed the 50 percent participation threshold on the first day alone.
The ballot, which runs through March 18, could pave the way for a joint protest next month and potentially a full-scale strike between May 21 and June 7 if the motion passes.
The vote follows a breakdown in wage negotiations after the National Labor Relations Commission suspended mediation between Samsung and its three main unions — the Samsung Electronics Labor Union (SELU), the National Samsung Electronics Union and Samsung Electronics Co. Union.
Together they represent more than 90,000 employees, roughly 70 percent of Samsung Electronics’ 129,000 workforce, making the potential walkout one of the most consequential labor actions in the company’s history.
At the heart of the dispute is Samsung’s Economic Value Added (EVA) bonus system.
Unlike local rival SK hynix, which distributes 10 percent of operating profit as bonuses and recently removed its payout cap, Samsung calculates performance rewards after deducting capital costs and taxes from operating profit. Union members argue the formula makes bonuses opaque and unpredictable.
“We initially demanded 20 percent of operating profit, but management offered us a choice between maintaining the current 20 percent EVA or shifting to a 10 percent operating profit model, which actually results in a smaller bonus pool,” a union official told AJP.
“What matters is that the bonus system must be transparent and predictable. The company needs to fundamentally reform the standard, starting with abolishing the annual salary cap,” the official added.
A prolonged strike could disrupt global IT supply chains because about 70 percent of the unionized workforce consists of engineers in Samsung’s critical Device Solutions (DS) division, which oversees semiconductor manufacturing.
The union strongly rejected the common industry assumption that highly automated semiconductor fabs could easily withstand a walkout.
“Only the wafer transport system is automated,” the official said. “If equipment fails or a safety interlock is triggered and engineers are not there to fix it, the machines simply stop.”
“For example, if 10,000 of the 14,000 workers at the Pyeongtaek campus join the strike, the plant would effectively be paralyzed. A two-week general strike would inevitably lead to production disruptions and declining chip quality.”
The unions plan to announce the voting results on March 18, hold a mass rally on April 23 and potentially begin a general strike in May unless management presents a revised proposal.
The dispute comes less than a year after Samsung experienced its first-ever strike in July 2024, led by the National Samsung Electronics Union. That walkout ended without major production losses, but the current movement poses a greater threat due to the larger number of engineers involved.
Samsung Electronics declined to comment on the potential strike or the unions’ demands.
Samsung, which enforced a strict “no-union” policy for decades, has seen organized labor expand rapidly since Chairman Jay Y. Lee publicly apologized in 2020 and pledged to end the practice.
The growing mobilization of younger engineers demanding transparent compensation is increasingly challenging Samsung’s traditional corporate culture at a time when the company faces fierce competition from global rivals such as TSMC and SK hynix in the race for AI semiconductor dominance.
“Some argue Samsung’s no-union culture helped fuel its past growth, but the company can no longer go against the flow of the times,” said Hwang Yong-sik, a business professor at Sejong University.
“At a critical moment when Samsung must compete with global rivals, repeating confrontations over an opaque bonus structure is a severe waste of time and resources.”
Hwang said management must address the root cause of distrust.
“SK hynix is delivering record results while paying top bonuses without internal conflict. Samsung needs to face reality and find a tailored compromise rather than clinging to outdated methods,” he added.
The labor dispute comes at a critical moment as Samsung Electronics races to catch up with SK hynix in high-bandwidth memory (HBM), the AI-era chip at the center of multibillion-dollar supply contracts with Nvidia and other big-tech names.
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