The strike would have impacted Samsung’s memory chip production.
Chung Sung-jun/Getty Images
Samsung’s largest labor union in South Korea has suspended the strike that was set to begin on May 21 after reaching a tentative deal with the company. Nearly 48,000 workers would have walked out for the strike, which was scheduled to last for 18 days. And since most of those workers belong to Samsung’s memory division, its biggest moneymaker, it could have had a huge financial impact on the company and on South Korea as a whole.
Union leader Choi Seung-ho has announced that the unionized workers will vote on the tentative agreement from May 22 to 27. A final agreement will only be reached after voting is done. “With a humble attitude, we will build a more mature and constructive labour-management relationship to ensure that such an incident never happens again,” Samsung said in a statement.
If you’ll recall, the workers decided to stage a walkout out after negotiations with Samsung fell through on the issue of bonuses. They wanted the company to remove the cap on their bonuses, which was equivalent to 50 percent of their annual salaries, like rival SK Hynix did for its employees. They were also pushing for Samsung to allocate 15 percent of its annual operating profit to the bonus pool. The union argued that SK Hynix, another South Korean semiconductor maker, gave its employees bonuses that were three times higher than what Samsung’s workers got last year. Some Samsung personnel even left for SK Hynix as a result.
According to Reuters, Samsung has agreed to abolish the cap and to set aside 10.5 percent of its annual operating profits for its employees. Yonhap News has reported that 40 percent of the bonus pool will go to memory chip division workers, while the rest of Samsung’s units will divide 60 percent among themselves. The agreed-upon percentage is lower than the union’s ask of 15 percent, but it’s higher than the 10 percent of profit SK Hynix is paying out to its people. Workers’ bonuses are contingent on the memory division making at least KRW 200 trillion ($133 billion) in profit from 2026 to 2028 and KRW 100 trillon ($66 billion) from 2029 to 2035. Samsung will pay part of those bonuses in company stock for at least 10 years.
It didn’t take long after the union announced its planned walkout for the government to step in. Talks restarted mere hours after the strike was announced, with South Korean Labor Minister Kim Young-hoon serving as mediator. Samsung, after all, accounts for 12.5 percent of South Korea’s GDP. The company is the world’s largest memory chip maker and made KRW 53.7 trillion ($35.63 billion) in operating profit for the first quarter of 2026 alone. South Korean Prime Minister Kim Min-seok previously said that direct losses from the 18-day strike could reach KRW 1 trillion ($669 million). The total economic impact of the walkout, however, could reach KRW 100 trillion ($66 billion) if Samsung scrapped the semiconductors already in production while the protest was ongoing.
