Samsung Memory Unit Offered Performance Bonus Exceeding 600% of Annual Salary

Reports have emerged that employees of Samsung Electronics' memory semiconductor business unit were offered a performance bonus exceeding 600% of their annual salary. Reuters reported, citing wage negotiation minutes, that Samsung Electronics proposed a plan to pay a performance bonus equivalent to 607% of annual salary to employees of the memory business unit in March.

This amount is significantly higher than the performance bonuses of 50% to 100% of annual salary proposed to the foundry business unit, which is responsible for semiconductor chip design and contract manufacturing.

The union reportedly did not accept the proposal, citing fairness with other business divisions. Choi Seung-ho, chairman of the Samsung Electronics branch of the Samsung Group's Trans-Corporate Labor Union, raised the issue of equity regarding the performance bonus gap between the memory and foundry business units during negotiations. The union opposed the proposal, arguing it would encourage personnel to leave non-memory business units and weaken Samsung Electronics' system semiconductor capabilities.

Kim Hyung-ro, a vice president at Samsung Electronics, explained that despite incurring trillions of won in losses, the system semiconductor business unit continues to receive investment, and these investment funds are being sourced from the profits of the memory business unit.

The union has signaled its intention to proceed with a general strike from the 21st of this month to July 7th if performance bonus negotiations break down, with an estimated 50,000 union members expected to participate. JP Morgan estimated that a strike could reduce the company's operating profit by up to 31 trillion won and sales by 4.5 trillion won, while also negatively impacting the national economy as a whole.