Samsung Electronics and its 47,000-strong labour union resumed negotiations in Seoul on Monday in a bid to avert an 18-day strike from Thursday, after a South Korean court granted an injunction restricting workers’ ability to halt production at the world’s largest memory chipmaker.
The Suwon District Court partially accepted Samsung’s injunction request against two unions, ruling that staffing levels required for safety protection, facility damage prevention and product quality must remain normal during any industrial action. Judge Shin Woo-jung also barred the pan-Samsung union and its leader, Choi Seung-ho, from occupying company facilities or obstructing workers from entering them, with fines of 100 million won ($72,000) per day for non-compliance.
Samsung shares rose as much as 6.7 per cent in morning trade before closing up 3.88 per cent, well ahead of a 0.31 per cent gain in the benchmark KOSPI index. Hyeseop Sim, a corporate lawyer, told the Financial Times that “the ruling will significantly weaken the scope of the strike and the negotiating power of the unions”, adding that chip production was therefore unlikely to be disrupted significantly.
The dispute centres on Samsung’s performance bonus structure. The union is demanding the abolition of a 50 per cent cap on annual salary bonuses, the allocation of 15 per cent of operating profit to a shared bonus pool, and the formal codification of those terms in employment contracts. Samsung has proposed allocating 9 to 10 per cent of operating profit to bonuses should annual profit exceed 200 trillion won, while retaining the existing cap.
Park Su-keun, chairman of the National Labor Relations Commission, confirmed after Monday’s session that both sides remained far apart but that talks would resume on Tuesday. A union representative said it had been “engaging in negotiations in good faith” but that the court ruling would not deter strike action if a satisfactory deal was not reached.
South Korean Prime Minister Kim Min-seok on Sunday described Monday’s negotiations as the “last chance” to prevent a walkout. “If the strike becomes a reality, the economic damage we would face would be unimaginable,” he told reporters, estimating direct losses at up to 1 trillion won and potential losses of 100 trillion won if semiconductor wafers in production had to be scrapped. Samsung accounts for 22.8 per cent of South Korea’s exports and roughly 12.5 per cent of its GDP.
President Lee Jae Myung, writing on X, said labour rights and corporate management rights must be “respected equally”, though he stopped short of directly naming Samsung. Samsung chairman Lee Jae-yong on Saturday issued a rare public apology to customers worldwide, saying: “Now is the time for us to wisely come together and move in one direction.”
The Federation of Korean Trade Unions pushed back against government pressure, arguing that invoking emergency arbitration based on what it called inflated damage estimates would deepen tensions, and said the dispute should prompt broader discussion about how corporate profits are shared. The Korean Confederation of Trade Unions warned that restricting strike action in strategic industries could set a precedent affecting workers in autos, shipbuilding, steel and batteries.
The threatened walkout comes as a global shortage of memory chips used in AI data centres drives soaring profits at Samsung and rivals including SK Hynix. Reuters reported that executives from Samsung’s chip division had warned the union that customers including Nvidia had indicated they might temporarily halt shipments during a strike over product quality concerns.
