Internal Samsung wage negotiation transcripts obtained by Reuters show the company proposed bonuses of 607% of annual salary for its memory chip division in March, while offering workers in its loss-making foundry and System LSI businesses between 50% and 100%. The documents, part of hundreds of pages of meeting minutes, offer a detailed look at the internal fractures driving Samsung toward what would be the largest strike in its history, scheduled to begin on Thursday.

Samsung's Device Solutions division houses three businesses under one roof: memory, System LSI, and foundry. The first is printing money on the back of AI-driven HBM demand, while the other two have posted combined operating losses running into the trillions of Korean won.

Samsung's negotiators argued in the transcripts that the bonus disparity reflects that, with Kim Hyung-ro, a vice president and management negotiator, telling the union that the logic chip divisions would have collapsed or shut down without the memory unit's profits. “So how can you ‌justify giving performance bonuses?” he is quoted as saying in the transcripts.

The union understandably rejects this reasoning, with its chairman, Choi Seung-ho, counterstating that a worker in the memory division receiving 500 million won in bonuses while a foundry colleague takes home 80 million won creates a retention crisis the company cannot afford.

Samsung has since replaced Kim Hyung-ro as its chief bargaining representative, reportedly at the union's insistence, and Chairman Jay Y. Lee issued a rare public apology on Saturday, cutting short an overseas trip to address the dispute in person.

Reuters has also reportedly spoken with workers who described shrinking teams in Samsung's foundry operations at Pyeongtaek, with engineers departing for both SK hynix and Micron. This confirms what union chairman Choi said last month, when he highlighted that roughly 200 Samsung employees moved to SK hynix over the previous four months alone.

SK hynix set a market benchmark last September when it agreed to allocate 10% of annual operating profit directly to employees for the next decade and removed caps on performance payouts. Based on 2026 profit forecasts, that deal translates to average per-worker bonuses approaching $477,000 this year, with projections nearly doubling in 2027. Samsung's union is demanding a similar structure: 15% of operating profit allocated to a bonus pool, the removal of the existing 50% cap, and formalization in employment contracts.

Samsung is the only major semiconductor company that designs logic chips, manufactures them on a contract basis, and produces its own memory. That integrated model underpins a long-standing ambition to challenge TSMC in contract chipmaking by 2030, backed by more than $116 billion in planned investment. But the bonus disparity exposed in the transcripts highlights a huge problem with housing wildly unequal businesses under one compensation framework.

Yonsei University professor Namuh Rhee argues that the conflict is partly a consequence of Samsung's own organizational design. Combining profitable memory with loss-making foundry operations under a single division, Rhee wrote, creates internal conflicts of interest and depresses the company's stock valuation, according to Reuters.

The April one-day walkout provided a preview of what a full stoppage could look like: memory fab output fell 18% on the affected shift, and contract foundry production dropped 58%. Samsung has already begun winding down chip production in anticipation of the strike going ahead.

Luke James is a freelance writer and journalist.  Although his background is in legal, he has a personal interest in all things tech, especially hardware and microelectronics, and anything regulatory.