Samsung union to start vote on tentative wage deal

SEOUL – Samsung labour union members will begin voting on May 22 on a tentative wage deal that averted what would have been a major strike at the South Korean chip giant this week.

The company and its union reached the provisional agreement late on May 20 following last-minute, government-mediated talks, avoiding a planned 18-day strike that was set to begin on May 21.

The dispute unfolded against the backdrop of a global artificial intelligence boom that has turbocharged Samsung’s chip business while lifting South Korea’s economic growth and stock market.

The company and the union’s lawyer both told AFP the vote – initially scheduled to begin on May 23 – will instead start on the afternoon of May 22.

A separate union document seen by AFP said the vote will run through May 27 and be conducted online.

Around 70,000 members are expected to be eligible to vote, and the agreement will be “automatically ratified” if more than half cast ballots and a majority of those voting approve it, according to the union’s lawyer.

The tentative deal introduces a new bonus pool for employees in the semiconductor division, equivalent to 10.5 per cent of the division’s operating profit, to be paid in stock.

Samsung semiconductor employees are expected to receive around 509 million won (S$431,000) under the new deal, a company official confirmed to AFP on May 21.

The figure is a rough calculation based on an estimated 331 trillion won in operating profit – in line with market consensus reported by Yonhap News Agency – and roughly 78,000 chip employees.

While workers are expected to benefit from the deal, some shareholders voiced opposition, vowing to pursue legal action against the tentative agreement.

On May 21, a shareholders’ group staged a rally near the residence of Samsung chairman Lee Jae-yong, arguing that operating profit-linked bonuses had not been approved through a shareholder resolution and therefore lacked legal validity under the current commercial law.

Samsung memory chips are used in products ranging from consumer electronics to computer processors, while its next-generation high-bandwidth memory chips are key components for scaling up AI data centres.

The tech giant said in April that its first-quarter operating profit jumped roughly 750 per cent from a year earlier, while its market capitalisation topped US$1 trillion (S$1.28 trillion) for the first time in May.

The prospect of a strike had raised concerns over the potential impact on South Korea’s economy, with semiconductors accounting for around 35 per cent of the country’s exports. AFP