Samsung does not reach a salary agreement with a union in South Korea; government tries to avoid strike

Samsung store in Seoul, South Korea
Reuters/Kim Hong-Ji
Samsung Electronics and the union that represents its employees in South Korea failed to reach a salary agreement in a negotiation held this Wednesday (13).
The uncertainty increases the risk of a strike that threatens not only chip production and the position of the semiconductor giant, but also the South Korean economy, which depends on exports.
The impasse comes after a marathon of negotiations mediated by the government on Monday (11) and Tuesday (12).
Samsung employees complain about having received a lower bonus than SK Hynix, a competitor in the manufacture of semiconductors, and plan an 18-day strike from May 21 if their demands are not met.
More than 50 thousand workers could go on strike, according to a warning from the union. The interruption could delay deliveries, further increase semiconductor prices and benefit competitors.
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Union representative Choi Seung-ho stated that Samsung rejected the demand for changes to the remuneration system, which includes the elimination of a bonus cap.
According to him, the union has no plans to resume negotiations before the strike date, but would evaluate "an appropriate proposal" if it is presented by the company.
Samsung regretted the failure of negotiations and said he will maintain a "sincere dialogue" with the union to avoid what he classified as the "worst possible scenario".
The South Korean government called an emergency meeting with ministers related to the issue. Prime Minister Kim Min-seok instructed the government to manage the situation closely "considering the severity of the impact on the national economy."
He also called for "proactive support to ensure that dialogue between the union and management can continue, so that it does not lead to a strike under any circumstances." negotiations".
The economy has become increasingly dependent on growing chip exports. Semiconductors accounted for 37% of the country's exports in April, up from 20% in the previous year, according to government data.

Source: G1