Samsung's union puts off strike after reaching last-minute wage deal
with management
[May 21, 2026] By
KIM TONG-HYUNG and HYUNG-JIN KIM
SEOUL, South Korea (AP) — Samsung Electronics’ labor union said
Wednesday it’ll hold off on launching a planned strike and put a
tentative wage deal with management to a vote, alleviating immediate
concerns about the operation of the world’s largest memory chip maker.
The announcement was made after a last-minute government-mediated
negotiation with management over how much bonus payouts must be provided
to employees to reflect soaring profits fueled by the global boom in
artificial intelligence.
Union leader Choi Seung-ho told a televised briefing that the union
agreed not to go ahead with an 18-day strike that he earlier said would
start from Thursday. He said union members will vote on the tentative
agreement from May 22-27.
“We would like to express our apologies to the people for causing
concerns due to our internal conflicts,” Choi said. “The agreement is
the result of our all-out struggle spanning about six months.”
Choi’s negotiating partner and senior Samsung official, Yeo Myounggoo,
told the briefing that the company hopes that the agreement will be a
starting point for more stable relations with the union.
“The company will faithfully implement the terms of this agreement and
will make its utmost efforts to promote labor–management cooperation,”
he said.
Government officials earlier had threatened to invoke rarely used
emergency powers to force a settlement at Samsung, as its union’s strike
was feared to rattle global semiconductor supplies and the country’s
trade-dependent economy. The union represents more than 70,000 workers.
Earlier Wednesday, the union and the management held each other
responsible for a failure to reach a deal, after their previous round of
negotiation ended without a breakthrough. Choi accused management of
refusing to accept a government-mediated proposal whose details he
refused to disclose. The management accused the union of calling for
excessive compensation packages for workers at loss-making units.
Samsung and its cross-town rival, SK Hynix, together produce about
two-thirds of the world’s memory chips, which are seeing surging demand
driven by AI. Samsung said last month its operating profit for the
January-March quarter jumped eightfold to a record 57.2 trillion won
($38 billion).
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The logo of the Samsung Electronics Co. is seen at its office in
Seoul, South Korea, Wednesday, May 20, 2026. (AP Photo/Ahn Young-joon)
 Union leaders have demanded a
compensation structure in which Samsung would commit to spend 15% of
its annual operating profit on employee bonuses and scrap bonus
caps, which are currently set at 50% of annual salaries. The company
says the demands are excessive, citing the highly cyclical nature of
the semiconductor business.
Samsung and union leaders did not immediately confirm the details of
their tentative agreement. Yeo suggested that the company had agreed
to union demands to extend bonuses beyond its lucrative memory
division to less profitable units.
“For example, we need to invest in the future of both our memory and
foundry businesses. These engineers all work in semiconductor
production, and we discussed ways to better motivate them,” he said.
Prime Minister Kim Min-seok, the government’s No. 2 official after
President Lee Jae Myung, said in a televised statement Sunday that
the strike could cause up to 100 trillion won ($66 billion) in
economic damage by disrupting Samsung’s highly complex semiconductor
manufacturing processes.
The planned strike could potentially have had a major global impact.
Given that supply in the global memory semiconductor market is
struggling to keep up with demand, the Samsung strike would have
been expected to further drive up prices and push back AI
infrastructure investments in other countries, said Lee Jun, an
expert at the Korea Institute for Industrial Economics and Trade.
The strike could have hurt operations of Samsung’s production of
smartphones and other consumer electronics as well, observers say.
A local court on Monday partially granted the company’s request for
an injunction against the planned strike, ruling that the union must
maintain certain staffing levels to prevent damage to facilities and
materials and ensure safe operations. The Suwon District Court also
barred unionists from occupying key facilities and offices.
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