Samsung executives make rare union visit as strike fears mount

SAMSUNG Electronics’ top management made a rare visit to leaders of the company’s largest labour union late Friday in an effort to revive stalled wage negotiations after government-mediated talks collapsed earlier this week. 

Samsung shares fell 8.6 per cent in Seoul trading Friday, underscoring mounting investor concerns over a strike that could disrupt operations at the world’s largest memory chipmaker. The union has threatened an 18-day walkout beginning May 21 if its demands are not met. 

Chief executive officer Jun Young Hyun, who heads Samsung’s semiconductor business, along with three other senior executives, visited the union’s office in the southern South Korean city of Pyeongtaek, home to Samsung’s sprawling semiconductor manufacturing complex, according to the union. 

“We will view the labour union as one family and a community of shared destiny and approach dialogue with an unconditionally open attitude,” Samsung said in a statement on Friday. “We earnestly urge that the union comes forward to engage in dialogue without delay, mindful of public concerns and the national economy.” 

Kim Young Hoon, Korea’s employment and labour minister, also met union’s leaders in Pyeongtaek. During the meeting, the union requested that Samsung appoint new management representatives for any future negotiations, according to a separate union statement. 

The outreach came days after marathon tripartite wage talks involving the government, Samsung and the union broke down without an agreement. That has fueled fears of labour disruptions at a critical moment for the company’s booming chip business that accounted for more than 90 per cent of its total operating profit in the first quarter. 

Late Friday, Samsung conveyed its willingness to resume negotiations, while union leaders responded that talks could continue if management presents proposals addressing the union’s core demands. 

The union has been pushing Samsung to expand performance-based compensation following a sharp rebound in semiconductor earnings driven by surging demand for artificial intelligence infrastructure.

Labour leaders are demanding that Samsung scrap an existing cap on bonuses, allocate 15 per cent of operating profit to worker bonuses and formalise those terms in employment contracts. 

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Samsung has proposed allocating 10 per cent of operating profit to bonuses, along with a one-time special compensation package that exceeds industry standards.

Company executives have argued that the union’s demands would be difficult to sustain over the long term. BLOOMBERG