Samsung Workers Escalate Labor Tensions with Indefinite Strike Call

Wednesday 10 July 2024 - 10:15

In a move that could potentially disrupt the operations of one of the world's largest technology conglomerates, a union representing workers at South Korean tech giant Samsung Electronics has called on its roughly 30,000 members to embark on an indefinite strike. This escalation comes as part of the union's ongoing campaign to secure better pay and benefits for its members.

The announcement was made on the final day of a three-day general strike held by the National Samsung Electronics Union (NSEU), which represents nearly a quarter of Samsung Electronics' workforce in South Korea. According to the union's statement, the decision to prolong the strike indefinitely was made after the company's management showed no intention of holding talks to address the union's demands.

"The company has no intention to engage in a dialogue even after the first general strike, thus we declare a second general strike starting from July 10th, lasting indefinitely," declared the NSEU, urging more of its members to join the industrial action.

While the union claims that its actions have already disrupted production, Samsung Electronics has disputed these claims. In a statement to BBC News, the company asserted, "Samsung Electronics will ensure no disruptions occur in the production lines. The company remains committed to engaging in good-faith negotiations with the union."

However, the union's resolve remains unwavering, with a spokesperson for Samsung Electronics declining to comment on the precise number of workers participating in the walkout. A protest held on Monday drew a crowd of around 3,000 people, underscoring the growing tensions between the workforce and management.

Jung In Yun, an analyst at Fibonacci Asset Management Global, offered a contrasting perspective, stating, "In our view, there will be no production disruption."

The current labor unrest marks a significant milestone for Samsung Electronics, as it is the first walkout at the company since its founding five and a half decades ago. Samsung Electronics, the world's largest maker of memory chips, smartphones, and televisions, is the flagship unit of the sprawling Samsung Group conglomerate, which dominates Asia's fourth-largest economy.

Historically, Samsung Group did not allow unions to represent its workers until 2020, when the company came under intense public scrutiny after its chairman was prosecuted for market manipulation and bribery. The formation of the NSEU came in the wake of this scrutiny, reflecting a shift in the company's labor relations.

Despite the ongoing labor tensions, Samsung Electronics' shares were trading flat to slightly lower on the Korea Stock Exchange following the NSEU's announcement. The company recently forecasted a 15-fold jump in profits for the second quarter of 2024 compared to the same period last year, driven by a boom in artificial intelligence (AI) technology that has lifted the prices of advanced chips.

As the indefinite strike looms, all eyes will be on Samsung Electronics and the NSEU, with the potential for significant disruptions to the company's operations if the labor dispute remains unresolved. The outcome of this standoff could have far-reaching implications not only for Samsung but also for the broader technology industry and South Korea's economy as a whole.