Samsung Electronics is set to engage in last-minute negotiations ahead of a planned strike in ten days. Experts warn that a breakdown in talks could disrupt semiconductor production and damage trust with global clients.
According to industry sources, Samsung Electronics and its labor union will conduct post-adjustment procedures at the Central Labor Relations Commission in Sejong City over two days, from May 11 to May 12. The super labor union has announced a strike starting on May 21.
The core issue at stake is not whether to provide performance bonuses, but how to determine the funding criteria and the cap on those bonuses. The union remains steadfast in its demands to eliminate the cap and to link bonuses to operating profits.
Choi Seung-ho, head of the Samsung Electronics branch of the super labor union, stated before attending the post-adjustment meeting, "We continue to advocate for a 15% performance bonus and the elimination of the cap, as well as institutionalizing these changes. If there is no stance on institutionalization, adjustments will not be possible."
While the company has left the door open for additional compensation, it has drawn the line at institutionalizing the elimination of the cap.
Legal experts caution against overestimating the significance of the post-adjustment process. Jo Yong-hyun, head of the law firm Class Han-gyeol, noted, "Post-adjustment is a procedure for the labor and management to ultimately come together. The commission can offer opinions and recommendations, but it cannot impose legal obligations." He added, "Ultimately, both parties must agree for it to take effect."
The legitimacy of the demand for performance bonuses as a valid purpose for industrial action is also a contentious issue. Jo suggested that it is likely to be interpreted as part of working conditions, but it could also be seen as an issue of management rights, leading to potential disputes.
A failure in post-adjustment talks is likely to lead to a strike. An executive at Samsung Electronics remarked, "If negotiations break down this time, it will be realistically difficult to resume talks before the strike."
The semiconductor industry is particularly concerned that a strike could have a greater impact than in other manufacturing sectors. Semiconductor production involves a series of continuous processes, and halting the lines can make it difficult to maintain yield and delivery schedules.
Kim Yang-pyung, a researcher at the Korea Institute for Industrial Economics and Trade, explained, "The semiconductor production line is like a furnace; once it stops, products in production must be discarded, and the repercussions can last for three to four months." He added, "Calculating the exact damage is virtually impossible, but it will likely exceed the figures currently being discussed."
Experts are more concerned about the long-term damage to trust rather than short-term production losses. Samsung Electronics is at a critical juncture in restoring trust with global clients in high-bandwidth memory (HBM), server DRAM, and advanced foundry processes. Repeated strike risks could raise questions about supply stability, contributing to heightened internal tensions at Samsung Electronics. Kim warned, "In the long run, the company will inevitably suffer significant damage to its credibility."
* This article has been translated by AI.
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