Samsung Electronics Labor and Management Resume Talks Today... Focus on Whether Conflict Will Be Resolved

Breakdown in Talks After 28 Weeks · Five Days of Leave Strikes
Likely to Discuss Main Negotiation Schedule
Differences in Opinions on Wage Increase Rate, Bonuses, and Leave

On the 13th, Samsung Electronics labor and management, which had experienced conflicts including declaring a strike for the first time since the company was established in 1969, will resume talks.

Samsung Electronics Seocho Building, Seocho-gu, Seoul [Image source=Yonhap News]

The Samsung Electronics National Labor Union (Jeonsamno) and the company will meet from 10 a.m. near the Seocho office building in Seoul to discuss the main negotiation schedule and the direction of discussions. There will be no rally by Jeonsamno members on this day, and only the leadership, including Chairman Son Woo-mok, will attend the talks. Key executives from the company side are also expected to participate. The labor-management dialogue comes 28 weeks after talks broke down during wage negotiations on the 28th of last month, and 5 days after Jeonsamno declared a strike and began a leave-of-absence protest on the 7th of this month.

The industry is paying close attention to whether this dialogue can serve as a stepping stone for Samsung Electronics labor and management to find a reasonable solution and amicably resolve the conflict. Considering Samsung Electronics’ current situation, where it needs to improve its recent poor performance in core businesses such as semiconductors and tighten competition, it is seen that the labor issue must be resolved as soon as possible. If the main negotiations following this dialogue fail to narrow differences, the union’s strike and rallies could be prolonged, which would be a source of concern for the company. It is reported that Samsung Electronics did not suffer significant losses in production during the five days since the union began the leave-of-absence protest.

Labor and management have differing views on wage increase rates, performance bonuses, and vacation systems. In particular, there are significant disagreements over wage increase rates and performance bonuses, which involve financial matters. The union proposed a 6.5% wage increase rate, while the company offered 5.1%. Union members cite examples of some competitors significantly raising wages despite deficits, insisting that "workers should be compensated according to their work" and are not backing down. Regarding performance bonuses, considering Samsung Electronics’ internal salary system where the base pay is lower compared to other companies, the union opposes reducing or eliminating performance bonuses. At a press conference held in front of the Seocho office building on the 29th of last month, Jeonsamno stated, "Competitors LG Electronics and SK Hynix operate performance bonuses based on operating profit," and added, "We do not understand why ours are based on Economic Value Added (EVA). It only seems like they do not want to share any more with employees."

On the other hand, the company argues that due to the semiconductor market downturn last year and performance falling short of expectations, it is proposing to agree on a wage increase rate in the 5% range and to temporarily suspend or reduce performance bonuses as a measure of shared sacrifice. A Jeonsamno official told Asia Economy in a phone interview, "At this point, it is difficult to say in which direction the resumed talks will proceed."

This content was produced with the assistance of AI translation services.