In brief: Samsung Electronics will soon face something it has never dealt with during the company's 55-year history: a worker strike. Union representatives have called for the industrial action after talks over wage increases broke down.
The National Samsung Electronics Union, which has about 28,000 members, or little over a fifth of the company's total workforce, will ask members to collectively use a day of paid leave on June 7. The union has not ruled out a full-scale strike at a later date.
"We can no longer tolerate labor oppression and union oppression. We are declaring a strike, given the management's attitude of ignoring workers," the union said.
Talks and negotiations between the union and management have been taking place since January without the sides managing to agree on wage increases. The union wants a 6.5% rise, an additional day of annual leave, and a bonus linked to the company's earnings. Samsung said it would increase wages this year by 5.1%.
Reuters writes that Samsung workers have been intermittently participating in protests in recent weeks outside the company's offices in the capital city Seoul as well as outside its chip production site in Hwaseong, south of Seoul.
Samsung Group only allowed unions to represent its workers in 2020 after its chairman was prosecuted for market manipulation and bribery.
A strike couldn't come at a worse time for Samsung Electronics. The company replaced the head of its semiconductor business last week in response to it falling behind in the development of high-bandwidth memory chips needed for AI and HPC systems, a move it called a "pre-emptive measure" to ensure it remains competitive.
Although its net profit was up during the first quarter, Samsung's share of the chip foundry business has shrunk in recent years from 18% to 12% as rival TSMC's expanded from 50% to 59%.
A coalition of five unions at Samsung affiliates, including another Samsung Electronics union, said they would not be joining the strike. The coalition said in a statement that the move appears to be part of efforts to join a combative umbrella union, rather than to improve workers' conditions.
Samsung Electronics says it will continue to negotiate with the union.