"Samsung Electronics Enters the Era of 600 Million Won Bonuses"...Even in the Red, Employees Will Receive at Least 160 Million Won

\r\n
[Financial News] Samsung Electronics' labor-management negotiations have been settled dramatically, putting a general strike on hold. If the tentative agreement reached by the two sides passes the union vote, the labor dispute that has dragged on for more than five months since last December is expected to come to a final close.
\r\n\r\n
On the afternoon of the 20th, Samsung Electronics and its labor union agreed on a bold compensation plan that fixes bonuses at more than 10% of business performance. As a result, employees in the semiconductor business, or DS division, could receive bonuses of up to about 600 million won this year, before tax, based on an annual salary of 100 million won. Even the non-memory semiconductor division, which is likely to post a loss, could receive at least 160 million won in bonuses.
According to Samsung Electronics' tentative labor agreement on performance pay for 2026, the company will keep the existing OPI system while creating a new special management performance bonus for the DS division. The special bonus will be funded by 10.5% of business performance selected through labor-management agreement, and there will be no separate cap on the payout rate. The fund will be allocated 40% to the division and 60% to the business unit, while the payout rate for common organizations will be set at 70% of the Memory Business rate.
If the business performance agreed upon by labor and management is assumed to be operating profit, each employee could receive as much as about 540 million won in stock as a bonus.
Samsung Electronics' operating profit forecast for this year is around 30 trillion won. In that case, 31.5 trillion won could be used as the fund for the semiconductor special management bonus. Of that amount, 40%, or about 12.6 trillion won, would go to the entire DS division's 78,000 employees. That means each employee in the Memory Business, the non-memory semiconductor division, and the Common Organization would secure about 160 million won in bonuses, regardless of business unit.
In addition, the remaining 60%, or about 18.9 trillion won, allocated to each business unit will be distributed between the Memory Business, with about 28,000 employees, and the Common Organization within the DS division, with 30,000 employees, at a ratio of 1 to 0.7. Based on this calculation, the Memory Business would receive about 380 million won per person, while the Common Organization would receive about 270 million won per person.
In the case of the Memory Business, employees would receive an additional 50 million won under the existing OPI system, based on an annual salary of 100 million won. Combined, that amounts to 600 million won in bonuses per person. However, loss-making divisions may not receive OPI payments.
\r\n\r\n
Meanwhile, the special management performance bonus will be paid in full after tax in treasury shares under company-set conditions. One-third of the shares granted may be sold immediately, while the remaining two-thirds will be subject to sale restrictions for one year and two years, respectively.
For loss-making divisions, the payout rate will be set at 60% of the common rate calculated using the division's fund, but the application will be delayed by one year and will begin with the 2027 payout.
The DS division's special management performance bonus will apply for the next 10 years. However, it is conditional on achieving 20 trillion won in DS division operating profit each year from 2026 to 2028, and 10 trillion won annually from 2029 to 2035.
This year's average wage increase rate was set at 6.2% — 4.1% for the base increase and 2.1% for performance-based increases. The two sides also agreed on measures such as the company housing loan program and higher childbirth and congratulatory payments for children, raised to 1 million won for the first child, 2 million won for the second, and 5 million won for the third and beyond.
As part of efforts to promote mutual growth, the company will also provide treasury shares worth 6 million won to the DX Division and the Customer Service and Support Business Team, and it plans to announce funding and operating plans for support to partner companies and shared growth as soon as possible.
bng@fnnews.com Kim Hee-sun Reporter