Choi Seung-ho, chairman of Samsung Electronics' largest labor union, speaks to reporters during a follow-up mediation session at the National Labor Relations Commission in Sejong, Tuesday. Yonhap
An additional round of wage negotiations between Samsung Electronics’ management and labor unions collapsed Wednesday, as the dispute spirals toward an 18-day strike involving more than 40,000 employees, mostly from the company’s chipmaking division, starting May 21.
While a last-minute settlement before the strike remains possible, concerns are growing over potential fallout from a walkout, with losses expected to reach 1 trillion won ($671 million) per day. Prolonged disruptions to semiconductor production lines could lead to structural damage for the company, including the possible loss of key clients such as Nvidia.
Samsung Electronics has filed an injunction with the Suwon District Court seeking to ban the planned labor actions, and the court is expected to issue its ruling before the strike begins. If the court accepts the request, the company may avoid large-scale disruption, but problems could drag on longer under a reduced workforce maintained only by essential personnel.
According to the government and industry officials, the two-day follow-up mediation session arranged by the National Labor Relations Commission ended at 3 a.m. without tangible outcomes.
Choi Seung-ho, the unions’ leader, stated that the talks had broken down, saying the two sides had failed to narrow their differences and had waited for the government’s mediation proposal, "only to see the talks regress further."
Samsung Electronics expressed deep regrets over the collapsed talks in a statement released hours later.
"The unions’ decision is causing significant concern and anxiety not only for the company but also for employees waiting for a settlement, shareholders and the public, and we deeply regret the decision," the company said.
"The unions have continued to insist only on a rigid institutionalization framework, rejecting the company’s proposal for a more flexible system tied to performance. The company will continue making every effort until the end to prevent the worst-case scenario through sincere dialogue."
The unions demanded that the company institutionalize its bonus system in order to improve transparency and predictability, by legally guaranteeing the allocation of 15 percent of operating profit as the source for performance bonuses. The unions indicated that if the full 15 percent allocation is difficult, part of the compensation could be paid in shares.
Source: Korea Times News
