Samsung averts planned South Korean factory strike after reaching a last-minute agreement with its labour union, avoiding a walkout that could have disrupted chip production at a sensitive moment for the company. The strike had been due to begin on Wednesday, May 21, but workers have now suspended the action while a new proposal goes to an internal vote.
Deal pauses the walkout
The agreement was reached only hours before the planned 18-day strike was set to start. While the details of the new proposal have not been made public, the union has agreed to hold off on industrial action for now.
That gives Samsung some breathing room after reports that it had already started winding down chip production in anticipation of the strike.
Why workers were pushing for change
The dispute centred on pay and performance bonuses. The union had previously called for Samsung to set aside 15% of annual operating profits for employee bonuses and to remove a 50% cap on yearly salary-based performance payouts.
Workers had also staged marches outside Samsung’s South Korean factories in protest at what they saw as a growing compensation gap.
- Union demanded a larger share of operating profits for bonuses
- Union also wanted the cap on performance pay removed
- Strike action has been suspended pending an internal vote
- Samsung had reportedly been preparing for possible production disruption
The SK hynix factor
The unrest at Samsung has also been shaped by developments at rival chipmaker SK hynix. Earlier this year, its labour and management union secured wage increases and an end to the cap on performance-based bonuses, setting a benchmark that Samsung employees appear to have been measuring their own pay against.
That appears to have contributed to both the protests and reports that some workers were leaving Samsung for SK hynix.
What happens next
The union is expected to vote on Samsung’s new proposal over the next week. For now, the immediate threat of a strike has passed, which is good news for Samsung’s factories and for a memory market that has been under close watch during the AI boom.
Whether the new deal satisfies both sides will depend on the vote, but the company has avoided a disruption that could have carried wider financial consequences.
Source
Source: PC Gamer Hardware