Biggest Strike in Samsung’s History Begins in South Korea as 6,500 Workers Walk Off the Job

In an unprecedented move, thousands of Samsung Electronics Co. workers walked off the job on Monday to demand better pay and working conditions, marking the largest organized labor action in the South Korean conglomerate’s half-century history. 

Summarized Insights:

• 6,500 Samsung workers strike for pay.

• Unprecedented labor action in South Korea.

• Strike aims to disrupt chip production.

• Samsung faces internal conflict amid key projects.

The strike underscores growing dissatisfaction among employees and could signal significant shifts in labor relations within South Korea's tech industry.

Discontented employees and union supporters braved the rain outside one of Samsung’s major chipmaking complexes, located south of Seoul. 

Clad in red headbands with “total strike” inscribed and black raincoats, the protestors lined up in orderly ranks along a broad thoroughfare, chanting slogans and raising their fists in unison.

Union leaders reported that over 6,500 workers had registered for the strike, although police later estimated the turnout to be closer to 3,100. 

This highly publicized protest aims to galvanize a three-day walkout, sending a powerful message to Korea’s largest corporation. 

This action follows a single-day strike in early June, the first in Samsung’s 55-year history, and marks a significant escalation in labor disputes.

The protest stems from the breakdown of negotiations over pay and vacation time last month. 

Union leaders argue that the strike is intended to disrupt production at one of Samsung’s most advanced chip facilities, highlighting the gravity of their demands. 

Despite the turmoil, Samsung’s shares remained largely unchanged on Monday, and the company stated that the strike had not yet impacted chip production.

Samsung's largest union, which has over 30,000 members, has been mobilizing support for the walkout for weeks. 

The union originally planned to gather up to 5,000 people for the rally outside Samsung’s Hwaseong facility, approximately 38 kilometers (24 miles) south of Seoul. 

While it remains uncertain how many workers will participate in the strike over the following days, the protest has drawn significant attention.

Union leader Son Woo-mok emphasized the goal of the walkout: to disrupt production and draw attention to their demands. 

For Samsung, this internal conflict comes at a critical juncture as it seeks to secure high-end AI memory chip contracts with Nvidia Corp. and maintain its dominance in the global memory and electronics market. 

The company is also preparing to unveil new foldable phones, watches, and a smart ring in Paris ahead of the Olympics.

The timing of the strike is particularly crucial given the ongoing challenges in the semiconductor supply chain. 

Samsung accounts for about 20% of the global DRAM market and around 40% of the NAND flash market, essential components in smartphones and servers. 

Any disruption in Samsung’s operations could have far-reaching implications.

Historically, Samsung has avoided the labor unrest that has plagued other South Korean companies, such as Hyundai Motor Co. and Ssangyong Motor Co. Analysts attribute Samsung’s tight control over labor activism as a key factor in its success. 

The late chairman Lee Kun Hee, father of current leader Jay Y. Lee, took extensive measures to prevent unions from forming within the company.

The current strike, led by the National Samsung Electronics Union, escalated after pay talks broke down. 

Despite Samsung’s attempt to mitigate the situation by announcing performance-related bonuses for semiconductor staff, the union found the offer insufficient. 

The dispute centers on higher wages, additional paid leave, and transparency in how bonuses are calculated.

Bonuses, which historically form a significant portion of worker compensation, have become a major point of contention. 

Union leaders demand that Samsung adopt a more straightforward and transparent method for calculating bonuses, similar to other companies in the industry.

As the strike unfolds, it highlights the growing tension within Samsung and the broader implications for South Korea’s tech sector. 

The outcome of this labor action could set a precedent for future labor relations and negotiations within the industry.