Samsung Electronics and Union Finally Reach a Preliminary Agreement

Samsung Electronics and the largest union at the company have finally reached a preliminary agreement on a new contract that provides for a wage increase as well as other benefit enhancements, the company announced today in Korea. The deal should put an end to any further labor actions. However, it still needs to be ratified by the union membership.

Learn more about this first labor action at Samsung

I first told you about this union activity at Samsung back in July. Unions throughout Asia typically work things out with management without resorting to walkouts, work stoppages, or major strikes. The fact that this action heated up and got a little ugly was really unusual.

In fact, the union did resort to a work stoppage, the first one timed to minimize the impact on the company’s production schedule. But eventually the union – the National Samsung Electronics Union – felt it had to escalate its tactics by calling for a work stoppage running over a few weeks that it said definitely impacted the company’s production schedule.

Now the two parties have reached an agreement in principle. According to a report by Reuters, the agreement calls for a wage increase of 5.1% for all workers. It is also said to include more holidays and bonus points (that Samsung employees can use to purchase the company’s products), and other perks.

The agreement will need to be ratified by the union membership. The union said it will begin the voting process immediately. They expect it to take about one week to complete the vote from all union members.

The NSEU has a total of 36,500 members who are all employees of Samsung Electronics. Although it is the largest union at the company, it is not the only union, there are at least two others that I know of there (and probably more). One interesting element of this story is that the other unions at Samsung chose not to move in solidarity with the NSEU – perhaps watching to see how management would respond to these actions that, by the existing standards in Asia, were seen as relatively aggressive.

Learn more about Samsung by visiting samsung.com.