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South Korean chip giant Samsung Electronics has reached an agreement with its labour union, mere hours before workers were due to begin an 18-day strike. The planned action was due to be taken today, Wednesday, May 21, but the union has agreed to suspend the strike and put a new proposal to an internal vote.
Details of the terms of the proposal are yet to be revealed, but the union previously pushed for Samsung to allocate 15% of its annual operating profits to employee bonuses (via Tom's Hardware). The union also proposed the scrapping of a 50% annual salary cap on performance pay-outs.
The marches are believed to have been prompted by similar demands made by the SK hynix labour and management union, which led to wage increases and a removal of the cap on performance-based bonuses for employees earlier this year.
As such, Samsung employees were said to be leaving for SK hynix in large numbers, or taking to the streets to voice their displeasure.
Samsung had reportedly argued that previous union demands would give excessive rewards to loss-making units, due to the differences between its memory division, currently prospering during the AI boom, and its other operations. It's unclear if proposals made in the new deal would attempt to address a balance between those two factors in terms of employee remuneration, but it's encouraging news for Samsung factory workers, at the very least.
Reports indicate that Samsung had begun winding down chip production in preparation for the strike, with potential indirect losses estimated to be in the billions if the planned action went ahead.
For now, the strike is suspended—and union voting on Samsung's new proposal is expected to be carried out over the next week. Here's hoping for a satisfactory result for all parties involved.
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