What just happened? Samsung will have other things on its mind today than the Unpacked event. An issue over better pay and benefits has led to the Samsung Electronics division’s largest union declaring an indefinite strike, extending what was supposed to be three days of industrial action.
It was reported in May that Samsung Electronics was facing something it had never dealt with during the company’s 55-year history: a worker strike. Representatives from the National Samsung Electronics Union (NSEU), which has more than 30,000 members, called for the action after talks over wage increases broke down.
A three-day general strike began on Monday (July 8), with thousands of workers protesting outside of Samsung’s chipmaking facilities south of Seoul. Wednesday was supposed to be the last day, but the union said management had shown no intention of holding talks over its demands. As such, the union has declared a second strike that starts today and will last “indefinitely.”
The NSEU said around 6,500 workers have taken part in the strike so far. It is calling for more of its members to join in the action.
Workers at Samsung Electronics workers began a three-day strike for better pay. The union said 6,540 workers will be striking at manufacturing sites and in product development, but the firm maintained there was no disruption in production. �’� Read it here: https://t.co/YDDMB8hkSn pic.twitter.com/ORxxKTVajR
– Reuters (@Reuters) July 8, 2024
“Management has no intention of dialogue,” the union said in a statement on its website. “We have clearly identified line production disruptions and the company will regret this decision.”
To try and attract more participants, the union said it will hold advertising campaigns at cafeterias inside chipmaking plants producing 8-inch wafers and high bandwidth memory (HBM) chips, which are in high demand due to the AI boom.
The union had demanded a 6.5% pay rise, an additional day of annual leave, and a bonus linked to the company’s earnings. It has since revised those demands to a 3.5% increase in base salary and, instead of the extra day’s annual leave, a day off to mark the union’s founding. It also wants the rank-and-file workers and executives to have an equal bonus system.
Union vice-president Lee Hyun-kuk told Reuters that management had offered a 3% pay rise, adding, “We haven’t spoken to management since we started the strike on Monday.”
Any disruption to Samsung Electronics’ production comes at a bad time for the South Korean giant. AI-related demand has seen Samsung estimate that its Q2 operating profits will jump 1,452% compared to a year ago. The company is also revealing the new Galaxy Z Fold 6 and Z Flip 6 foldable devices, along with several other new products, today.
