Samsung Electronics averts strike with new wage deal
May 21 (UPI) -- The largest trade union of Samsung Electronics said Wednesday that it would suspend a planned general strike scheduled Thursday through June 7 after reaching a tentative wage deal with management through last-minute negotiations.
The union said its 70,000-plus members would vote on the agreement starting Friday for six days.
Under the agreement, Samsung workers will receive an average wage increase of 6.2%. For the semiconductor division, a special bonus of up to 10.5% of operating profit will be paid entirely in company shares, subject to lockup periods.
The two sides also agreed to eliminate bonus caps previously set at 50% of annual salary.
The special bonus will be granted only if the company achieves $130 billion in operating profit.
The world's largest memory chipmaker is expected to easily achieve the target in the coming years, thanks to the global AI boom. Many brokerages forecast that the firm's operating profit for 2026 will approach $200 billion.
"We were able to finally reach an agreement thanks to the support of the public, shareholders, customers, and our employees, as well as the government's dedicated mediation efforts," Samsung said in a statement.
"With humility, we will work to build a more mature and constructive labor-management relationship."
The presidential house welcomed the agreement, congratulating labor and management for reaching an agreement that benefits the country.
Investors responded positively, as Samsung's shares surged more than 5% at the opening bell on Thursday. The benchmark KOSPI opened 3.85% higher, and as gains accelerated, the Korea Exchange temporarily halted a buy-side order of KOSPI futures orders.
Observers noted that the fallout from a strike could have had long-lasting repercussions for the company and the economy.
"It is fortunate that a worst-case scenario was avoided for the sake of our economy. However, it may trigger a chain reaction in other industries," said Lee Phil-sang, adviser at Aju Research Institute of Corporate Management and former economics professor at Seoul National University.
"In addition, we need to ask whether workers can reasonably make such a demand. From the perspective of shareholders, [companies] may argue that operating profit belongs to them, not employees," he said.
As a reaction to the planned settlement, a group of Samsung Electronics shareholders rallied in Seoul on Thursday, vowing to take legal action against the labor-management agreement.
Unions formed
Since its foundation in 1969, Samsung Electronics has operated for decades without a labor union. That changed in the late 2010s, when employees began to form multiple unions.
Earlier this year, the largest union, headed by Choi Seung-ho, secured a majority of Samsung Electronics workers as members, strengthening its influence in negotiations with management.
Demanding 15% of Samsung Electronics' annual profits as bonuses, Choi threatened to launch an 18-day strike if the company did not accept the proposal.
Management, shareholders and the public opposed a potential strike, which they feared could cause losses in the tens of billions of dollars for the semiconductor manufacturer.
According to a survey of polling agency Realmeter late last month, 69.3% of respondents said that the strike would be inappropriate because of excessive demands and concerns over weakening corporate competitiveness, while 18.5% said that it was justified as a legitimate exercise of workers' rights.
Choi also sparked controversy through remarks about creating a blacklist of employees who cooperate with management.
"If there are employees who continue siding with the company, we will keep a list of them," he said on YouTube, promising to impose penalties on them.
"We also plan to operate a reporting center for those who support or side with management. Union members who submit reports will be eligible for rewards," he added.
Economic commentator Kim Kyeong-joon, formerly vice chairman of Deloitte Consulting Korea, expressed concern about employees' bonus demands.
"The strong earnings at Samsung Electronics are boosted by the semiconductor super-cycle and unprecedented demand for memory chips amid the AI boom. Against this backdrop, we need to question whether employees can reasonably demand such big bonuses," he said.
"If workers want to share profits during boom periods, they should also be willing to accept lower wages during downturns. If they seek a share of the gains, they should also be prepared to share the burden of losses."
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This story was originally published May 21, 2026 at 6:53 AM.