Samsung Faces Massive Strike Threat: Will a Bonus Dispute Destabilize the Chip Giant?

Translation result.

[Sankyung Today = Reporter Park Tae-jin]

Samsung Electronics’ management and its union are scheduled to return to the bargaining table three days before a planned company-wide strike.

Government mediation and public comments from Chairman Lee Jae‑yong have reopened channels for talks, but a fundamental divide remains over whether to formalize the performance-bonus formula. That unresolved issue makes late-stage negotiations likely to be difficult.

Industry sources say representatives from Samsung and the union will attend a second post-adjustment session at the Central Labor Commission in Sejong on the 18th.

This session is seen as the last practical mediation step to narrow differences ahead of the general strike set for the 21st.

Earlier, the parties met for post-adjustment hearings at the Central Labor Commission from the 11th to the 12th but were unable to find common ground on bonus payment methods and institutional reforms.

Talks appeared to stall afterward, but Labor Minister Kim Young‑hoon met with both sides in succession and helped arrange additional negotiation sessions.

Park Soo‑geun, chair of the Central Labor Commission, is expected to observe the upcoming meeting in person. The government’s direct involvement reflects its view that the dispute could affect not only one company but also the semiconductor industry and the broader South Korean economy.

Both sides have made limited concessions to reopen dialogue.

The company replaced a lead negotiator the union had objected to, and the union agreed that the previous negotiator would attend meetings without speaking.

Those moves have eased the procedural tension around the negotiations.

Chairman Lee Jae‑yong issued a public apology the day before, calling on employees and the union to unite as “one body, one family.”

This is the first time Lee has issued a public apology since taking office, and analysts say his remarks increase the political and reputational stakes if talks fail.

The core disagreement, however, remains the size and calculation of performance bonuses.

The union is pushing to allocate 15% of operating profit to performance bonuses and to make the existing OPI (operating profit incentive) system more transparent.

It is also calling for removal of the current bonus cap—set at 50% of annual salary—and for the bonus-calculation criteria to be codified in a collective agreement or formal company policy.

The company, by contrast, has reportedly proposed keeping the OPI system in place while creating a separate special reward fund equal to 10% of operating profit under certain conditions, such as achieving an industry-leading position.

Management argues that a fixed distribution formula would reduce flexibility to respond to semiconductor market fluctuations and could constrain funds for future investment.

Some observers say the size of the bonus itself may be negotiable.

The union has indicated it might consider alternatives, such as adjusting the profit-sharing ratio or expanding OPI stock compensation.

The company has signaled willingness to expand special rewards and to adjust bonus caps for some business units, leaving room for compromise on amounts and payment mechanisms.

The sticking point is institutionalization. The union contends that past bonus calculations lacked transparency and that the company did not consistently uphold promised compensation principles.

Management counters that locking bonuses into a fixed formula could undermine managerial flexibility during downturns or major investment phases.

The semiconductor division, in particular, expects improved results as AI-driven demand grows and the memory market recovers.

The union argues the company should set reasonable distribution criteria when profits expand.

Management warns that standards set in boom times could become a financial burden in future downturns.

Business leaders say the outcome could influence not only Samsung’s internal labor relations but also bonus systems across major South Korean firms.

If Samsung institutionalizes profit-linked bonus rules, similar demands could spread to other manufacturing and high-tech companies.

Should a general strike occur, the dispute could spotlight risks to Samsung’s operational stability, global customer confidence, and the semiconductor supply chain—even if production disruptions are limited.

For those reasons, both sides must weigh the public backlash that would follow failed negotiations.

An industry source said, “The key in these talks is not just the bonus amount but how far the company can formalize its profit-sharing principles,” adding, “The critical question is whether union and management can craft a compromise that preserves both legitimacy and practical flexibility.”