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Samsung Electronics and its labor union are making a final push for a deal this week as a planned May 21 strike threatens to disrupt operations at the world's largest chipmaker. This week's talks are seen as the last meaningful chance to avoid an 18-day walkout that could ripple through global semiconductor supply chains.
The two sides resumed government-mediated post-mediation talks on Monday under the National Labor Relations Commission. According to a report by The Korea Herald, no breakthrough had been reached as of 3 p.m. local time. This post-mediation procedure serves as a follow-up that occurs after formal mediation ends, provided both labor and management agree to continue negotiating. Any agreement reached during this stage carries the same legal force as a collective bargaining deal. At the center of the dispute is the performance-based bonus system utilized by the electronics giant. The union is demanding that Samsung abolish the bonus cap and allocate 15 per cent of its operating profit to a performance bonus pool. Based on projections that Samsung Electronics could post up to 300 trillion won, or approx. USD 204 billion in annual operating profit this year, some employees in the chip division could receive nearly 600 million won (approx. USD 420,000) each under the proposal. Management has offered what it describes as a special compensation package that exceeds rival industry standards. However, the company has rejected institutionalizing the removal of the bonus cap. Executives argue that such a financial structure would be difficult to sustain over the long term. The report noted that if this week's talks collapse, Samsung faces only the second strike in its history. The company experienced its first-ever strike in 2024, led by the National Samsung Electronics Union. At that time, the union had roughly 32,000 members, but only about 15 per cent participated, which limited the overall impact on production. The stakes are significantly higher for the current standoff. The broader union coalition now comprises around 73,000 members, and industry estimates suggest that 30,000 to 40,000 workers could join the walkout. The union has warned it will stage a full-scale strike from May 21 to June 7. The report estimated that the 18-day action could inflict losses worth tens of trillions of won. JPMorgan Chase recently estimated the dispute could reduce the annual operating profit of Samsung Electronics by more than 40 trillion won (approx. USD 28.76 billion). Labor Minister Kim Young-hoon noted on Monday that the post-mediation process began following concerted efforts to bring both sides back to the negotiating table. "I thank both labor and management for making the decision," the report quoted Kim. "This will not be an easy mediation, but the solution may already be closer than we think." Samsung and the union failed to reach a compromise during mediation talks in February and March, prompting the labor commission to suspend the process. The two sides later agreed to return to negotiations after the Labor Ministry urged another round of talks. (ANI)
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