Samsung is heading toward a strike that could impact global chip supplies and smartphones

Management and union leaders at Samsung Electronics failed to reach a last-minute wage deal, increasing the likelihood of a strike that could disrupt global semiconductor supplies. Government officials threatened to use rarely used emergency powers to compel a settlement. The union, representing more than 70,000 workers, said Samsung has not offered adequate compensation despite record profits driven by artificial intelligence demand. After talks ended without agreement, unionized workers planned an 18-day strike starting Thursday. Both sides blamed each other: the union accused management of rejecting a government-mediated proposal, while management said the union sought excessive compensation for loss-making units. Samsung and the union continued efforts to negotiate, with another meeting held under the Labor Minister’s arrangement. Samsung and SK Hynix supply about two-thirds of the world’s memory chips, and Samsung reported a sharp rise in operating profit for the January-March quarter.

"Management and union leaders at Samsung Electronics failed to reach a last-minute deal over wages Wednesday, raising prospects for a strike at the South Korean electronics giant that could rattle global semiconductor supplies and the country's trade-dependent economy."

"After the latest round of talks ended without a breakthrough on Wednesday, union leader Choi Seung-ho told reporters that unionized workers will begin an 18-day strike from Thursday."

"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."

"Government officials have threatened to invoke rarely used emergency powers to force a settlement at Samsung, where the union, which represents more than 70,000 workers, says the company has failed to offer adequate compensation despite its soaring profits fueled by the global boom in artificial intelligence."

Read at Fast Company