Members of Samsung Electronics' labor unions stage a protest at the company's plant in Hwaseong, Gyeonggi Province, July 8, 2024. Korea Times photo by Seo Jae-hoon
Samsung Electronics is facing a potential general strike by its unionized workers, increasing a sense of uncertainty for the company, which is already facing heightened geopolitical risks from the current conflict in the Middle East.
According to the unions, the National Labor Relations Commission decided on Wednesday to suspend mediation for wage negotiations between Samsung Electronics and its top three labor unions — Samsung Electronics Labor Union, National Samsung Electronics Union and Samsung Electronics Co. Union. Samsung Electronics Labor Union claims it has more than 66,000 members, accounting for more than half of the company’s 129,000 employees.
With the commission failing to mediate the dispute, the unions are now legally allowed to carry out labor actions, including strikes. To proceed, the unions must hold a vote among their members, and a strike can begin if a majority votes for the action.
The two sides have been in wage negotiations since December last year, but have failed to narrow their differences, with both sides refusing to compromise over a union demand for removal of the upper limit on the company’s excess profit incentive, called OPI.
The company said in a statement that it regrets the negotiation failure, saying “the unions repeatedly demanded the removal of the upper limit on OPI.”
The company proposed maintaining the current OPI ceiling of up to 50 percent of an employee’s annual salary while allowing workers to choose between operating profit and economic value as the basis for calculating the incentive.
The proposal also included an additional 100 percent OPI payout for employees of the memory division if operating profit exceeds 100 trillion won. The company also proposed special incentives for non-memory divisions currently posting losses, depending on the degree of improvement in their performance.
Union members, however, say they feel disadvantaged compared with SK hynix, which paid performance bonuses equivalent to 2,964 percent of base salaries. Some also raised concerns that the plan could widen gaps between business divisions, saying the company appears to favor the memory segment.
If union members vote for a general strike, Samsung Electronics could face its first strike in nearly 20 months .
Source: Korea Times News
