Samsung Electronics union's three-day strike plan gets cold shoulder

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Samsung Electronics union's three-day strike plan gets cold shoulder

Published: 02 Jul. 2024, 17:58 Updated: 04 Jul. 2024, 16:44

JIN EUN-SOO
jin.eunsoo@joongang.co.kr

A truck used by the labor union of Samsung Electronics for protests is parked by the sidewalk at its Seocho office in June. [NEWS1]

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Samsung Electronics' unionized workers are heralding an unprecedented three-day strike, but its impact on both the market and the public remains minimal.

The National Samsung Electronics Union (NSEU), the company's biggest labor union with approximately 28,000 members, accounting for 22.8 percent of the entire workforce, declared late Monday that it failed to reach an agreement with management and will stage a full-fledged walkout from July 8 to 10.

Although it will be the first multiday walkout for Samsung Electronics, the market was unbudged, with the company's shares closing at the same price as the previous day at 81,800 won ($58.87).

Public sentiment wasn't too supportive of the union's action either, with assertions that its demands lack justification.

The union had requested an enhanced pay raise for 855 members of the union who rejected the 3 percent annual pay raise suggested by the company. The union had also requested an overhaul of its overall performance incentive system, known as OPI, following an incentive payout of nothing to the DS division last year as the chip business incurred trillions of won in losses due to a cyclical downturn.

"Samsung Electronics in the eyes of the public is still Korea's No. 1 company giving out high paychecks," said Hwang Yong-sik, a business administration professor at Sejong University.

"[The union's] collective action for higher wages seems selfish in a way, and too demanding. While Samsung has to put up a fight with TSMC and other global players, internal friction like this seem really unnecessary, which is why public sentiment is negative about the union's actions."

Samsung Electronics had distanced itself from union-driven conflict until the abolishment of its "no labor union" policy in 2020 by then-vice chairman Lee Jae-yong.

After starting the negotiations in January, the union decided to stage the first ever walkout in the company's 55-year history on June 7. The strike lasted for a single day with participation by a limited number of union members, leading to no disruption in production.

"If this walkout is pushed to the limit, it could lead to production disruptions, but instead of imitating the hard-line union culture of Korea like that of Hyundai Motor's, Samsung's unionized workers should set a new standards and hold substantial talks with management as outlined by new set of manuals," Hwang said.

The announcement of the three-day walkout came after the talks between the union and Jun Young-hyun, the newly appointed head of Samsung Electronics' Device Solutions (DS) in charge of chip business, failed to produce a consensus Monday.

The NSEU said there could be additional walkouts if the company's stance remains unchanged during the first one. It added that it is rolling out a survey to see how many members will join the collective action this time.

"Management is fully responsible for the entire business loss incurred from the walkout due to the insincere attitude shown through the negotiations," the NSEU said in a statement.

"Until our demands are satisfied, we will fight by staging walkouts based on the 'No Work, No Pay' principle."

BY JIN EUN-SOO [jin.eunsoo@joongang.co.kr]