The South Korean technology giant Samsung Electronics is facing the largest strike in its history. Starting May 21, more than 45,000 employees plan to walk off the job for 18 days. Such a strike could significantly disrupt global supply chains, as Samsung is the world's largest supplier of memory chips.
JPMorgan estimates that the strike could cost the company up to 31 trillion won, approximately 20.79 billion dollars, in operating profit. The conflict centers around profit-sharing from the boom in Artificial Intelligence (AI). The union has rejected an offer to resume wage negotiations and is demanding a change in the company's negotiating team.
Employee representatives are calling for a 7 percent increase in base salaries and the distribution of 15 percent of the annual operating profit as bonuses. These demands contrast with the bonuses of competitor SK Hynix, which has eliminated caps on employee bonuses.
Additionally, there are internal tensions, as bonuses for employees in the profitable memory chip division could reach up to 607 percent of their annual salary, while workers in the loss-making contract manufacturing sector are expected to receive only 50 to 100 percent. The South Korean government has already warned of the potential economic damage from a strike and may initiate compulsory mediation.
