Samsung Electronics' union threatens first ever walkout next week


FILE PHOTO: The National Samsung Electronics Union (NSEU) members hold banners that read "Respect labour" in front of the Samsung Electronics Seocho Building in Seoul, South Korea, May 24, 2024. REUTERS/Kim Soo-hyeon/File Photo

SEOUL (Reuters) -A Samsung Electronics union in South Korea will begin escalating strike action next week by staging the first ever walkout over demands for higher wages, union officials said on Wednesday.

The National Samsung Electronics Union (NSEU), which has about 28,000 members, or more than a fifth of the company's total workforce, said it will stop work for one day on June 7 as part of broader protest measures.

The announcement was made by union officials at a live-streamed press conference, where they held a banner which read: "We can no longer tolerate labour repression, union repression."

If the union members collectively take the day off next week, it would mark the first ever walkout by South Korean workers at the world's top memory chipmaker.

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.

Responding to a decision by the company to increase wages this year by 5.1%, the union has previously said that it wanted an additional day of annual leave as well as transparent performance-based bonuses.

On Wednesday, the union accused the tech giant of failing to bring a compromise plan to negotiations held the previous day.

Samsung Electronics said in a statement on Wednesday: "We will sincerely engage in discussions with the union."

Union officials defended the decision to take industrial action at a time when some parts of Samsung's business are underperforming.

"The company has been saying they are facing crisis all along for the past 10 year," Son Woo-mok, president of NSEU told reporters, but added that the firm should not use it as an excuse not to meet its demands.

The union said all company sites across South Korea would be affected by its June 7 action. NSEU is the biggest of five labour unions at South Korea's tech giant. It is not clear whether other smaller unions plan to join the action.

Responding to Wednesday's proposed strike, a coalition of five unions at Samsung affiliates including another Samsung Electronics union questioned the intention behind the strike plan, indicating they would not join the move.

The coalition said in a statement it appears to be part of efforts to join a combative umbrella union, rather than to improve workers' conditions at the tech company.

The strike announcement comes as Samsung, one of the world's biggest chipmakers and smartphone makers, appears to be faltering in some areas, including cutting-edge semiconductor chips.

Samsung last week replaced the head of its semiconductor unit saying a new person at the top was needed to navigate what it called a "crisis" affecting the chips industry.

More than 2,000 unionised workers of the South Korean technology giant gathered in Seoul last week to hold a rare rally to demand better wages.

Union membership has increased rapidly after Samsung Electronics in 2020 pledged to put an end to its practices of discouraging the growth of organised labour.

Analysts said the rise in union membership reflects workers' frustration with a recent slump in Samsung's competitiveness in businesses such as high bandwidth memory (HBM) chips and due to legal issues facing the tech giant.

In one case the company is battling a prosecution appeal of a decision that found Samsung Electronics' chairman Jay Y. Lee not guilty of fraud and other charges related to a 2015 merger of Samsung companies.

Shares of Samsung Electronics closed down 3.1% on Wednesday, compared with the benchmark KOSPI's 1.7% fall.

(Reporting by Hyunsu Yim, Heekyong Yang and Ju-min Park; Editing by Ed Davies, Shri Navaratnam and Sonali Paul)

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