Samsung faces walkout at display affiliate

Samsung Display's campus in Asan, South Chungcheong Province / Courtesy of Samsung Display

By Kim Bo-eun

Samsung is facing its first possible workers' walkout after group head Lee Jae-yong made a key pledge to better protect workers' rights last year. The union of Samsung's display manufacturing affiliate decided Wednesday to take collective action over its differences with management in wage negotiations.

Samsung Display is fretting over the union's move since how it will handle the issue will set the tone for the nation's largest conglomerate's relationships with its other subsidiaries' unions.

Market observers are paying keen attention to the publicized labor-management conflict as this is taking place after Lee stated in May last year that the conglomerate would comply with laws guaranteeing workers' rights.

Samsung Display's union plans to stage a partial strike June 21, after talks with management were suspended last week.

Managers gave union representatives a list Tuesday of the minimum number of workers needed to continue plant operations if the union stages a walkout. This is among the final steps taken prior to launching a strike.

"Talks have been suspended after the union voted against a management proposal last week. We are now following the final steps before taking action," Kim Jong-soo, vice chairman of Samsung Display's union said, Wednesday. “The union will stage a rally June 21 with six union members beginning a strike. We plan to carry out the walkout on a gradual basis.”

It appears the union is taking a cautious approach, given this would be the first strike at a Samsung affiliate, if executed, following the Samsung chief's promise. Samsung Display declined to comment on the matter.

The union acquired 91 percent support from members through a vote last month to take collective action. A labor ministry-affiliated committee then suspended mediation after determining differences between labor and management were too difficult to narrow down. This has enabled the union to secure the right to stage a legal strike.

The union has demanded a 6.8 percent wage hike for this year based on the company's handsome earnings last year, but management has maintained it cannot go beyond a 4.5 percent increase that was agreed to at a labor-management council. The firm's wage hike for 2019 was 3.5 percent, and for 2020 2.5 percent. The union is also calling for a rise in hazard pay, given this has remained frozen for a decade.

Calls for better compensation are growing as workers at leading tech firms have become more vocal in terms of demanding greater pay. Such demands were earlier seen at SK hynix, SK Telecom and Naver.

Samsung is operating a compliance committee, which was set up in February last year after a court order to ensure the conglomerate abides by labor laws. The committee held a meeting Tuesday, where affiliates each reported the status of negotiations between unions and management.

Samsung Display's union was launched in February last year under the Federation of Korean Trade Unions ― it has about 2,400 members, which is 13 percent of the company's workforce. Over 20 unions represent Samsung's affiliates.