Samsung strike involving 47,000 workers looks ahead as South Korean president calls for labor deal
Members of the Samsung Electronics labor union held signs that read “Change it to be seen!” as they stage a mass rally to demand the removal of protection for performance bonuses, outside a semiconductor manufacturing company’s factory in Pyeongtaek on April 23, 2026. (Photo by Jung Yeon-je / AFP via Getty Images)
Jung Yeon-je | Afp | Getty Images
South Korean President Lee Jae Myung on Monday called for the rights of workers and management to be respected as an 18-day strike by Samsung Electronics looms.
Lee, writing to X in Korean, said “employees must be respected as business, and corporate management rights must be respected as workers’ rights.”
“Extremism is not beneficial; extremism leads to revolution,” he added, according to a CNBC version of his statement.
Lee’s comments are the latest at a conference of government officials urging Samsung Electronics and the labor union to reach an agreement ahead of a strike scheduled to begin on May 21.
The final round of negotiations between the union and Samsung management was due to take place on Monday.
The union’s demands center on Samsung’s performance-based bonus system. It calls for performance bonuses equal to 15% of Samsung’s operating profit, the removal of bonus payment caps, and a formal bonus structure, among other measures.
Samsung executives have promised to allocate 10% of operating profit to bonuses and offer a special compensation package at the same time, according to South Korean news agency Yonhap.
Shares of Samsung Electronics rose as much as 6.65% on Monday.
Economic collapse
On Sunday, South Korean Prime Minister Kim Min-seok reportedly said the government would consider all possible responses, including “emergency reforms,” if the strike risks causing “serious damage.”
Under South Korean law, the labor minister can request an “emergency adjustment” to suspend industrial operations for 30 days if a dispute appears to harm the economy or daily life.
Kim described Monday’s talks as the last chance to avoid a strike, adding that “the economic losses we will face are unimaginable.”
The prime minister estimated that direct losses from the strike could reach 1 trillion won ($664.7 million). Economic losses could rise to 100 trillion won if disruptions in chip production force Samsung to abandon semiconductor wafers already in production.
Samsung Electronics accounts for 22.8% of South Korea’s exports and 26% of its total market capitalization, he stressed. The Seoul presidential office also said that Samsung Electronics’ revenue accounts for 12.5% of South Korea’s GDP.
Analysts have raised concerns about the dangers of concentration in the South Korean stock market, with overreliance on a small group of companies raising the risk of volatility and vulnerability to country shocks, including a drop in data center spending.
Kim’s statements also followed Finance Minister Koo Yun Cheol’s X last week, warning that “strikes must not happen under any circumstances.”
“Samsung Electronics is an important company that the world is watching,” Koo wrote. “Given the current state of the administration and its impact on the country’s economy, both sides of labor and management must continue to strive to achieve meaningful negotiations.”
Samsung chairman Lee Jae-yong on Saturday issued a rare public apology to customers around the world for causing “anxiety and worry,” according to South Korean media reports.
More than 47,000 workers may participate in the strike, the union said.
It also said the April 23 strike, which drew 40,000 workers, resulted in a 58% drop in foundry production and an 18% drop in Samsung memory production that day. The union estimates that the 18-day strike could cost Samsung about 30 trillion won, or about $20 billion.
– CNBC’s Miko Jang contributed to this report.
