Samsung Union Suspends Strike After Reaching Tentative Deal On Bonuses

Samsung’s largest labor union in South Korea has suspended a strike that was scheduled to begin on May 21 after reaching a temporary agreement with the company. About 48,000 workers would have walked out on strike, which was scheduled to last 18 days. And since most of those employees belong to Samsung’s memory division, its biggest money maker, it could have a huge financial impact on the company and South Korea as a whole.

Union leader Choi Seung-ho has announced that unionized workers will vote on the temporary agreement from May 22 to 27. The final agreement will be reached only after voting. “With a polite attitude, we will build a more mature and constructive labor-management relationship to ensure that such an incident does not happen again,” Samsung said in a statement.

If you remember, the employees had decided to stage a walkout after talks failed with Samsung over the bonus issue. They wanted the company to remove the cap on their bonuses, which was equal to 50 percent of their annual salary, as rival SK Hynix did for its employees. They were also pressuring 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 workers bonuses that were three times higher than those received by Samsung employees last year. As a result, some Samsung personnel also left for SK Hynix.

according to reutersSamsung has agreed to waive this limit and set aside 10.5 percent of its annual operating profit for its employees. yonhap news Samsung said 40 percent of the bonus pool will go to employees of the memory chip division, while Samsung’s remaining units will split 60 percent among themselves. The agreed percentage is lower than the union’s request of 15 per cent, but it is more than the 10 per cent of benefits SK Hynix has been paying its people. Workers’ bonuses are dependent on the memory division making a profit of at least KRW 200 trillion ($133 billion) from 2026 to 2028 and KRW 100 trillion ($66 billion) from 2029 to 2035. Samsung will pay a portion of those bonuses in company stock for at least 10 years.

It did not take long for the union to announce its planned walkout for the government to intervene. Talks resumed just hours after the strike was announced, with South Korean Labor Minister Kim Young-hoon serving as mediator. After all, Samsung accounts for 12.5 percent of South Korea’s GDP. The company is the world’s largest memory chip maker and earned KRW 53.7 trillion ($35.63 billion) in operating profit in the first quarter of 2026 alone. South Korean Prime Minister Kim Min-seok earlier said that direct losses from the 18-day strike could reach KRW 1 trillion ($669 million). However, the total economic impact of the walkout could reach KRW 100 trillion ($66 billion) if Samsung removed semiconductors already in production while the protests continued.