Samsung strike threat puts South Korea on edge with chip giant tied to quarter of exports

SEOUL, May 17 — South Korea will pursue ‌all options, including emergency arbitration, to avoid ​a labour strike at the country’s biggest employer Samsung Electronics and to minimise any damage if one ‌does occur, its prime minister said on Sunday.

The world’s largest ​memory chip maker and its South Korean labour union will resume pay talks on Monday with a government mediator, in a move that could ease ​concerns over a potentially disruptive strike at the tech giant that accounts for nearly a quarter of the country’s exports.

“Just one day of suspension at Samsung Electronics’ semiconductor factory is expected to incur direct losses of as much as ‌1 trillion won (US$667.68 million; RM2.64 billion),” Prime Minister Kim Min-seok said after ⁠an emergency meeting with ministers ⁠on Sunday.

“What is more concerning is that a ⁠temporary pause on semiconductor manufacturing ⁠lines leads to ⁠months of inactivity,” Kim said, adding there were worries about economic damage ballooning to as much as 100 trillion won if ⁠materials had to be disposed of due to a strike.

An emergency arbitration order, which can be invoked by the labour minister if the country deems a dispute is likely to harm the economy or daily life, immediately prohibits industrial action for 30 ⁠days while the National Labor Relations Commission conducts mediation and arbitration.

It has rarely been invoked and would represent an extraordinary ⁠step for a union-friendly administration.

The union said it would negotiate in ⁠good ⁠faith to reach an agreement with management.

Samsung accounts for 22.8 per cent of South ​Korea’s exports and 26 per cent of the ​domestic stock market, employing more than ‌120,000 people and working with 1,700 suppliers, ​Kim said. — Reuters