Employees at Samsung Electronics launched a three-day walkout on Monday in protest of their low pay, and if the largest company in South Korea doesn’t meet their demands, the union plans to take additional action.

In addition, the National Samsung Electronics Union (NSEU), which represents about a quarter of the company’s South Korean workforce with some 30,000 members, demands modifications to the employee bonus scheme and an additional day of yearly leave for unionised workers.

Analysts predicted that the strike won’t have a major effect on output at the largest memory chip manufacturer in the world because of low participation and automated manufacturing. Even yet, it indicates a drop in employee satisfaction at a critical juncture in the semiconductor sector as big companies adopt AI.

In order to organise a mass walkout, the union staged its first industrial action last month. According to Samsung, this strike had little effect on commercial activities. The company announced on Monday that there was no manufacturing hiccup.

The union announced that 6,540 workers, largely from manufacturing and product development, will go on strike this week. The group did not provide the percentage of workers that participated in last month’s walkout. It stated that operations may be impacted by the walkout, which involves personnel who keep an eye on automated production lines and equipment.

About 3,000 strikers gathered in the rain near Samsung’s headquarters in Hwaseong, south of Seoul, according to union officials.

Union head Son Woo-mok told Reuters that the five-year-old union did not have enough time to teach members about the concerns, refuting media allegations of low participation.

“Labour union education has not been sufficient. However, given that our union is still relatively new in comparison to other unions, I don’t believe that participation is low,” he stated.

Vice president of the union Lee Hyun-kuk warned that if Samsung does not improve its offers, there may be further strikes.

Although Samsung’s plans provide for flexibility in terms of yearly leave and compensation, Lee said that they do not satisfy union requests for higher salary and leave.

Union officials favour parity in the bonus structure as well.

They added that whereas incentives for CEOs are determined by personal performance targets, bonuses for rank-and-file employees are determined by subtracting the cost of capital from operational profit.

“I was telling people that I was proud to work at Samsung, but the truth is I am not,” said Park Jun-ha, a 20-year-old engineer who joined the company in January and works on the chip packing lines. He also expressed dissatisfaction with the company’s “opaque” compensation structure.

Since Samsung promised in 2020 to cease discouraging organised workers, the union’s membership has increased. According to observers, as Samsung attempts to negotiate the competition in semiconductors used for artificial intelligence (AI) applications, its increasing voice is demanding attention.

Union representatives blame Samsung’s AI problems on the company’s sluggish progress in developing high bandwidth memory (HBM) chips, which are in great demand for use in AI processors. Samsung’s share price performance has behind that of its fellow chip rival, SK Hynix.

Samsung nevertheless projected a more than 15-fold increase in second-quarter operating profit on Friday, as rising chip prices propelled by the AI boom helped to boost earnings above the low comparative base of the previous year.

After hitting a session high of 1.72% earlier in the day, its share price saw a 0.2% increase in afternoon trading on Monday, the best since January 2021. It increased 6.9% last week as a result of preliminary quarterly earnings that beat analyst projections.

(Adapted from TheStar.com)