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Choi Seung-ho, head of the Samsung Electronics branch of the multi-employer union, attends the second post-mediation meeting at the Central Labor Relations Commission in the Sejong Government Complex on May 18. (Photo: Yonhap News Agency) |
[Alpha Biz= Paul Lee] Internal divisions within Samsung Electronics are intensifying as labor unions clash over compensation structures, undermining momentum for a planned strike and exposing deeper tensions between business divisions.
According to industry sources on May 18, secondary unions—including the National Samsung Electronics Union and a separate pro-management labor group—publicly called for greater representation of the company’s Device eXperience (DX) division during resumed labor talks, just days before a potential walkout.
The dispute centers on widening compensation disparities between the Device Solutions (DS) division, which has benefited from the AI-driven semiconductor boom, and the DX division, which focuses on finished products and has faced weaker performance amid slowing global demand.
The primary bargaining union, which holds majority status and is largely composed of DS employees, has pushed for measures such as removing caps on performance bonuses and adopting an operating profit-sharing model—proposals that critics argue disproportionately favor the DS division.
Tensions escalated further during a confrontation between union leaders, with DX-aligned representatives demanding that previously discussed proposals reflecting their interests be incorporated into negotiations.
The conflict is also spilling into legal action. A group of DX employees filed for an injunction at the Suwon District Court seeking to halt ongoing wage negotiations, arguing that the current process sidelines DX workers and violates union procedures by relying on survey results instead of formal general assembly approval.
Controversial remarks by a senior union official—suggesting that dissatisfied units could consider spinning off—have further aggravated internal discord.
Industry observers point to the stark divergence in business performance as the root cause. While the DS division has seen surging profitability amid the AI semiconductor supercycle, the DX division has struggled with muted demand and intensifying competition.
Even if this year’s negotiations conclude, analysts warn that the fundamental clash between a performance-based compensation model favoring high-performing divisions and a company-wide shared contribution approach is likely to persist.
With the imbalance expected to continue, calls are growing within and outside the company for broader organizational and cultural reforms to address internal cohesion and support long-term talent retention.
Alphabiz Reporter Paul Lee(hoondork1977@alphabiz.co.kr)
https://www.alphabiz.co.kr/news/view/1065618763032368
This article is based on global economic content from Alphabiz, which distributes English-language news on Korean markets and companies to international audiences.
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