Unions representing Samsung Electronics workers have said they expect about 37,000 people to attend a rally on Thursday at the company’s sprawling chip manufacturing campus in Pyeongtaek, South Korea. The event comes as labour tensions build at the firm and follows the recent surge in union membership across Samsung’s South Korean workforce.
The planned demonstration is being staged ahead of a threatened strike set to begin on May 21, which unions have said would last 18 days if no settlement is reached. Organisers say the rally underscores a growing set of labour risks for Samsung - a company that until recently had appeared largely insulated from the kind of worker unrest seen at other major domestic employers.
Union membership at Samsung has expanded rapidly in 2024. According to union statements, membership has tripled to exceed 90,000 employees, now representing over 70% of Samsung’s South Korean headcount of 125,000. The increase comes amid record profits at chipmakers as surging demand for artificial intelligence infrastructure has tightened supply and lifted prices.
Unions point to developments at other chipmakers as a catalyst for membership growth. In September, SK Hynix accepted its union’s demands for compensation reforms and sizable bonuses, a move that union representatives say intensified frustration among Samsung staff over a perceived pay gap. The unions contend that the prospect of higher pay elsewhere has prompted some employees to leave for competitors.
"The phenomenal growth in union memberships reflects a unified and urgent call among employees for change at Samsung Electronics," said Choi Seung-ho, leader of Samsung’s largest union, last week. Choi also said many workers had departed for SK Hynix and that other rivals, including Micron and Tesla, were recruiting Samsung engineers. Samsung does not disclose employee turnover.
Management has acknowledged the issue. In March, Co-CEO Jun Young-hyun recognised that Samsung lagged rivals on wage competitiveness because of weak chip earnings, and said he expected the gap to narrow as the chip market recovers. The company has cautioned that it may pursue legal action if unions disrupt safety-critical operations that require more than 2,000 workers to run.
There is still uncertainty over how many employees will attend the rally. One union member in Samsung’s IT support group said colleagues had inundated him with requests for vests to wear at the demonstration. Samsung has warned that it will take legal steps if unions interfere with facilities whose operation depends on thousands of staff.
Key points of contention in negotiations include the union demand to remove a cap on performance pay currently set at 50% of annual base salary. The union is also seeking an allocation of 15% of annual operating profit to be paid as performance bonuses, along with a 7% increase in base salaries. Management has countered with an offer that would allocate 10% of operating profit for performance pay and additional funding to ensure that employees in the memory division receive higher payouts than their peers at competing firms this year.
Unions contend that such offers leave a pay gap compared with rivals. Samsung’s cross-town competitor SK Hynix, which unions say will report a five-fold increase in first-quarter operating profit on Thursday, has approved a similar compensation overhaul, a development unions cite as widening the gap between pay at SK Hynix and Samsung.
Observers offer differing assessments of the potential operational impact should a strike occur. Seo Ji-yong, a business administration professor at Sangmyung University, said a strike could delay shipments, push chip prices higher and advantage competitors. Other experts note that automation within factories and Samsung’s reliance on subcontractors could reduce the immediate disruption to output.
If no agreement is reached ahead of the deadline, unions have said they will proceed with an 18-day strike beginning May 21. The outcome of the talks will determine whether the rally escalates into sustained industrial action capable of affecting chip deliveries during a period of elevated demand driven by AI investment.
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