Samsung Consumer Union sues to block 'unfair' AI bonus vote

An internal civil war has erupted at Samsung Electronics over how to distribute the massive financial spoils of the artificial intelligence boom, with a major union filing a lawsuit to completely halt a critical vote on a new corporate pay package.

The Samsung Electronics Co Union (SECU), which represents roughly 13,000 workers primarily across the company's smartphone, television, and home appliance divisions, turned to a South Korean court on Tuesday. The union is demanding an immediate injunction against the current government-mediated labor agreement, claiming non-chip employees were unlawfully stripped of their right to participate in the vote, News.Az reports, citing Reuters.

The legal standoff threatens to undo a hard-fought compromise reached just last week, which narrowly averted an 18-day strike by 48,000 workers and brought immense relief to South Korea's export-reliant economy.

However, the terms of the deal have exposed deep demographic divisions within the tech giant. Fueled by skyrocketing global demand for high-performance hardware, the proposed agreement heavily favors the high-profit memory chip division. Under the current structure, some memory chip workers are on track to receive eye-watering bonuses totaling $416,000 this year alone. In contrast, engineers in the foundry and logic design units will receive substantially lower payouts, while staff in consumer appliances and smartphones will receive a fraction of that amount.

Why the union split: Disgusted by the vast pay disparities, SECU negotiators walked away from the bargaining table before the final deal was struck. The final contract was ultimately signed by a separate group, the Samsung Electronics Labor Union (SELU), which represents the bulk of the chip workforce.

While SELU announced on Tuesday that more than 90% of its 57,290 eligible members have already cast ballots ahead of Wednesday's voting deadline, the contract's future is highly unstable. Another major labor faction, the National Samsung Electronics Union (NSEU)—which commands 20,000 members across both chip and non-chip fields—has announced a total boycott of the vote to express its anger over the terms.

To pass, the deal requires a simple majority vote from eligible unionized workers. If the court blocks the tally or if voter turnout drops below the required threshold due to the boycotts, labor negotiations must legally restart entirely from scratch.

Compounding Samsung's corporate headache, a localized coalition of individual shareholders has also threatened to sue if the deal passes, arguing that such massive bonus payouts legally require direct shareholder approval. Despite the mounting labor chaos, investor confidence remained resilient, with Samsung shares climbing 2.7% in morning trading.

News.Az 

By Aysel Mammadzada