"Samsung Union's Historic Walkout in South Korea"

Boston Brand Media brings you the latest - The Samsung Electronics union in South Korea makes history with its inaugural walkout, representing a significant milestone in labor activism within the tech giant's home country. This unprecedented action signals a shift in the relationship between workers and management, highlighting growing concerns over labor rights and workplace conditions. The walkout underscores the determination of the union to advocate for its members and enact meaningful change within one of the world's largest technology companies.

SEOUL, June 7 (Reuters) - The inaugural walkout by the National Samsung Electronics Union (NSEU), comprising approximately 28,000 members, marks a significant shift in employee assertiveness. This action occurred on Friday, reflecting a growing trend among workers within the conglomerate. The union, representing over a fifth of Samsung Electronics' workforce, halted operations for a day to advocate for improved wages. This move comes amidst the company's endeavor to advance in AI chip technology, adding weight to the demands for better compensation.

Analysts suggest that while the walkout may not have an immediate effect on semiconductor production or deliveries, it will increase pressure on Samsung Electronics as it strives to excel in AI and close the gap in contract chip manufacturing with Taiwan's TSMC. "Today's strike aims to initiate substantive discussions with management," stated NSEU representative Lee Hyun-kuk to Reuters. He indicated that the union is planning additional measures on Friday but refrained from elaborating on specifics.

Samsung Electronics stated that the strike had no effect on production or business operations. They noted that the walkout occurred the day after a public holiday, resulting in fewer employees on annual leave compared to the same day last year. However, the union did not reveal the number of members who participated in the strike by taking annual leave. "We have earnestly interacted with the union and will maintain dialogue with them," remarked a company representative.

Boston Brand Media also found that Samsung Electronics' stock saw a 0.1% decline in closing, contrasting with the benchmark KOSPI's 1.2% increase.

According to market researcher TrendForce, the walkout is not expected to affect DRAM or NAND flash memory production or cause shipment shortages due to extensive automation in manufacturing.

Furthermore, TrendForce noted that the walkout primarily involved employees from the company's Seoul headquarters rather than production facilities and was scheduled for only one day.

The strike is part of a series of worker protests in recent weeks, occurring outside offices in Seoul and at a chip production site in Hwaseong, located south of the capital. These protests were triggered by Samsung Electronics' decision to raise wages by 5.1% this year.

The NSEU, the largest among the firm's five unions, is seeking further commitments such as enhancements to the performance-based bonus system and an additional day of annual leave.

Contrary to the strike, a coalition comprising five unions at Samsung affiliates, including another smaller Samsung Electronics union, urged the NSEU to prioritize negotiation over confrontation. They indicated their decision not to participate in the strike.

CHIPS AND MOBILE PHONES

Samsung Electronics is facing challenges in various sectors, including cutting-edge chips, prompting the replacement of the head of its semiconductor unit due to what it terms as an industry "crisis."

Any extensive or prolonged industrial action would pose a significant problem for the world's largest memory chip maker as it endeavors to keep pace with competitors producing high bandwidth memory (HBM) chips for AI applications.

SK Hynix and Micron are already supplying HBM chips to Nvidia, which holds approximately 80% of the global graphic processing unit (GPU) market for AI applications. Nvidia announced this week that the three chip makers will provide HBM chips, with SK Hynix remaining its primary supplier.

In a recent Reuters report, it was revealed that Samsung's HBM chips had yet to meet Nvidia's testing standards, a crucial factor both in terms of reputation and profit momentum, according to analysts.

Despite facing challenges in its chip business, Samsung surpassed Apple to become the world's top smartphone seller in the first quarter, accounting for 20% of shipments, according to research firm Counterpoint.

Union membership saw a rapid increase after Samsung pledged to cease its practice of discouraging organized labor in 2020. Union officials noted a growing perception among younger employees that unions can contribute to a fairer workplace, whereas older generations viewed unions as potential disruptors of productivity.

According to labor ministry data, South Korea's union membership rate has remained around 10% since 2004.

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Source: Reuters‍