At 3 a.m. local time on May 13th, representatives from the Samsung labor union walked out of the negotiation room and announced to reporters: "The negotiations have failed. The two-day government-brokered talks have collapsed!" 

The union immediately reiterated: "If our demands are not met, over 50,000 workers will embark on an 18-day comprehensive strike starting from May 21st.".

According to reports, Samsung workers' bonuses currently have an upper limit of no more than 50% of their annual basic salary. The union demands the complete abolition of this cap, and that 15% of operating profits be allocated to employee bonuses, with the relevant terms written into labor contracts. 

Samsung, on the other hand, proposes allocating 10% of operating profits to bonuses, with an additional one-time special compensation, claiming that this "exceeds industry standards." Company executives believe that the union's demands are unsustainable in the long run. 

According to Reuters, a union representative stated, "I deeply regret that none of the issues raised by the union have been responded to." He also said that there are currently no plans to resume negotiations before the strike, but he is willing to consider it if the company proposes "a formal plan.".

The dissatisfaction among Samsung workers has a specific frame of reference: their competitor, SK Hynix. It was reported that SK Hynix abolished the bonus cap last year, and its employees received bonuses more than three times that of Samsung employees. This news directly led to a surge in the number of Samsung union members. Union leaders pointed out that SK Hynix had agreed to allocate 10% of its annual operating profit to the performance bonus pool, but Samsung's union demanded a higher proportion of 15%. 

In the wave of AI chips, Samsung also enjoyed a demand dividend. Last week, Samsung's market capitalization surpassed $1 trillion, making it the second Asian company to reach this milestone after TSMC. Employees believe that while the company's profits have increased significantly, they have not shared enough of the spoils. 

According to Bloomberg, the American Chamber of Commerce in Korea stated this week: "Major production disruptions or operational uncertainties at Samsung Electronics could put additional pressure on the global memory semiconductor market, exacerbating supply bottlenecks, price volatility, procurement uncertainties, and broader supply chain instability."

The strike could potentially cause delays in customer shipments, further escalate chip prices, and benefit competitors like Micron and SK Hynix. Currently, Samsung is fiercely competing with SK Hynix and Micron Technology in the memory chip market, and any production disruptions could further complicate Samsung's efforts to accelerate the development of its next-generation semiconductors.