July 10, 2024 – In a decisive move, the largest labor union at Samsung Electronics, the Korean National Union of Samsung Electronics Workers (KNUSEW), has announced an indefinite strike action, citing the company’s management’s reluctance to engage in meaningful dialogue. The announcement comes as a culmination of ongoing tensions between the union and the tech giant.
Comprising over 30,000 members, the KNUSEW represents approximately 24% of Samsung’s total workforce in South Korea, underscoring its significant influence within the company. The union’s decision to embark on an open-ended strike follows a three-day protest that commenced on July 8th, with over 6,500 workers participating in a show of solidarity to demand higher wages and revisions to the performance bonus system.
During the second day of the initial strike, on July 9th, the union issued a stern warning, stating that the absence of a satisfactory offer from management by Wednesday would prompt a transition to an indefinite strike. This ultimatum highlights the union’s determination to secure its demands and the depth of discontent among its members.
The crux of the dispute revolves around two primary issues: firstly, the union contends that the proposed 5.1% wage increase falls short of expectations, advocating for an escalation to 6.5% to better reflect the workers’ contributions and the current economic climate. Secondly, the union seeks a revamp of the performance bonus calculation methodology, shifting away from the existing economic value added (EVA) metric (which deducts capital investments from post-tax operating net income) to align with industry peers like SK Hynix and LG Electronics, who base bonuses on operating profit.
In response, Samsung has expressed its stance that the current market conditions do not favor granting the union’s demands. Furthermore, the company maintains that production operations have remained uninterrupted and unhindered by the strike action thus far. However, this assertion may be tested as the strike enters its indefinite phase, potentially escalating the conflict and its implications for both parties.
The ongoing standoff between Samsung and its largest labor union underscores the complexities of balancing the interests of workers and corporate profitability amidst a rapidly evolving technological landscape and economic uncertainties.
