South Korea Samsung union declares ‘indefinite’ strike

Members of the National Samsung Electronics Union gather during a rally outside of Samsung Electronics’ Hwaseong campus in Hwaseong, South Korea, Monday, July 8, 2024. Unionized workers at Samsung Electronics declared an indefinite strike Wednesday, July 10 to pressure South Korea’s biggest company to accept their calls for higher pays and other benefits. (Hong Ki-won/Yonhap via AP)

Seoul, South Korea — A union representing tens of thousands of workers at Samsung Electronics in South Korea said Wednesday it would extend a three-day strike indefinitely in a bid to force management to negotiate.

The strike is the biggest labour action in the tech giant’s history and steps up pressure on the chipmaker’s management, who last week predicted a huge second-quarter operating profit increase.

“(We) declare a second indefinite general strike from July 10, after learning that the management has no willingness to talk,” the National Samsung Electronics Union said in a statement.

READ: South Korea Samsung workers start strike, says union chief

More than 5,000 members stopped working Monday for what was meant to be a three-day strike, part of a long-running battle over pay and benefits.

The move follows a one-day walkout in June, the first such collective action at the company, which went decades without unionisation.

The union has more than 30,000 members — more than a fifth of the company’s total workforce.

Samsung told AFP Wednesday that the strike would not affect production.

“Samsung Electronics will ensure no disruptions occur in the production lines,” a spokesperson told AFP.

“The company remains committed to engaging in good faith negotiations with the union.”

But the union said it had confirmed “clear disruption in production,” and added that the longer the strike went on “the more the management will suffer.”

“Eventually, they will kneel and come to the negotiation table. We are confident of victory,” it added in a statement.

READ: Samsung Electronics forecasts major Q2 profit jump

The union blamed Samsung management for “obstructing” the strike, saying they did not appear willing to engage in dialogue.

It urged more workers to participate, including “those who are still hesitant”.

“Your determination is needed to advance our goals and victory. Let us unite our strength to protect our rights and create a better future.”

Avoiding unions

The union has been locked in negotiations with management since January, but the two sides have failed to narrow differences.

Workers have rejected the offer of a 5.1 percent pay hike, with the union having previously outlined demands including improvements to annual leave and transparent performance-based bonuses.

The impact of the strike “depends on various factors, (such as) duration of the strike, accordingly lost days of production and recoup strategy,” Neil Shah, research vice president at Counterpoint Research told AFP.

He added that it was also important “how Samsung management has prepared knowing this could happen and already have simulated the solutions to solve this quickly”.

Samsung Electronics managed to avoid having its employees unionise for almost 50 years — sometimes adopting ferocious tactics, according to critics — while rising to become the world’s largest smartphone and semiconductor manufacturer.

Company founder Lee Byung-chul, who died in 1987, was adamantly opposed to unions, saying he would never allow them “until I have dirt over my eyes”.

The first effective labour union at Samsung Electronics was formed in 2019.

Soon after, Lee Jae-yong, the founder’s grandson and current chairman of Samsung Electronics, declared an end to the firm’s no-union principle in 2020.

Samsung’s labour policy “failed to meet the demands of changing times,” Lee, then Samsung’s vice-chairman, said.

The firm is the flagship subsidiary of South Korean giant Samsung Group, by far the largest of the family-controlled conglomerates that dominate business in Asia’s fourth-largest economy.

It is the world’s largest memory chip maker and accounts for a significant chunk of global output of the high-end chips.

Samsung recently predicted a more than 15-fold increase in its on-year second-quarter operating profits, thanks to growing demand for generative AI.