DS bonuses reach 600 million won, DX gets 6 million won... A general strike was avoided, but internal division is looming [Samsung Electronics bonus backlash]

Samsung Electronics labor and management reached a tentative agreement just before a general strike, but internal backlash over the memory-centered bonus structure is spreading quickly. There is even talk that the deal could be rejected in a vote by union members. In particular, voices of relative deprivation are growing among non-memory units such as the System LSI Division and foundry, as well as common research organizations and the Device eXperience Division (DX Division). Industry observers say, "A general strike was narrowly avoided, but Samsung's compensation dispute has now entered round two."
Jun Young-hyun, head of the Device Solutions Division (DS Division) and vice chairman in charge of semiconductors, also stepped in personally and tried to calm the situation by saying, "We must put the time of conflict behind us and pull together as one." Still, since clashes of interest across business units have already surfaced, analysts expect the internal rift to continue for some time.
■"Only memory gets 600 million won?" Semiconductor workers voice frustration
According to industry sources on the 21st, Samsung Electronics' union will hold a vote on the tentative agreement from 2 p.m. on the 22nd until 10 a.m. on the 27th. However, many negative votes are expected, especially from some non-memory and common organizations, as well as the DX Division.
The key point of the agreement is the creation of a special management performance bonus for the DS Division. Labor and management agreed to use 10.5% of business performance as the bonus pool and to remove any payment cap. The special management performance bonus will be paid entirely in company stock after taxes. The pool will be divided 40% for the DS Division as a whole and 60% for each business unit. The payout rate for common research and support organizations was set at 70% of the Memory Business level.
If this year's operating profit for the DS Division is assumed to be 30 trillion won, the special bonus pool would amount to about 3.15 trillion won. Of that, about 1.26 trillion won, or 40%, would be distributed equally among the division's 78,000 employees, regardless of business unit, amounting to roughly 16 million won per person. The remaining 1.89 trillion won, or 60%, would be allocated additionally to the Memory Business and common organizations. Based on industry and union estimates, a manager-level employee earning 80 million won a year could receive up to 600 million won in bonuses at the Memory Business, including the existing profit-sharing incentive (OPI). Common organizations would receive about 400 million won, while loss-making units such as System LSI and foundry would get only a little over 200 million won.
An internal source said, "The backlash from common and research organizations is stronger than expected." The source added, "This is not just about the amount of money. People seem to see it as a symbol of which organization is being recognized as the core driver of the company's growth."
■Even Jun Young-hyun steps in... signs of internal strain
The sense of deprivation is even greater in the DX Division. It is not eligible for the special management performance bonus, and the separate compensation plan included only 6 million won worth of company stock. As a result, criticism of the enterprise-wide labor union that led the negotiations is also growing. Some DX union members even filed an injunction with the Court the previous day, seeking to suspend collective bargaining against the enterprise-wide labor union. They protested, saying, "The unchecked power of the enterprise-wide labor union completely excluded DX Division and CSS (Compound Semiconductor Solutions) members from the negotiations." They added, "The real role of a union is to bring together stronger voices and deliver them to management as one."
Given the situation, management has also moved to calm internal tensions. In a message to employees on the day, Jun Young-hyun, head of the DS Division and vice chairman, said, "There must have been considerable concern and disappointment during the negotiations, and I am taking that seriously." He directly acknowledged the internal conflict and fatigue. He then emphasized unity, saying, "What matters now is putting the time of conflict behind us and moving forward with everyone pulling together as one."
Still, industry observers believe the dispute will likely drag on, as the negotiations have gone beyond a simple wage settlement and exposed deeper clashes over business-unit interests and compensation systems inside Samsung Electronics. A business community source said, "A general strike was prevented, but internal conflict over compensation systems and organizational integration across business units is likely to intensify."
soup@fnnews.com Im Su-bin Reporter