Samsung Electronics Co.’s unionized workers voted to approve a wage agreement, the union said Wednesday. This photo, taken Wednesday, shows Samsung headquarters in Suwon. Photo by Yonhap
Samsung Electronics Co.’s unionized workers voted to approve a wage agreement that includes a substantial bonus package for chip workers, the union said Wednesday, easing concerns over potential disruptions to the global supply chain.
In the six-day vote, 73.7 percent of the 62,616 members of the tech giant’s two largest unions approved the tentative deal. The agreement was finalized after a majority of eligible voters took part in the vote and a majority voted in favor of the proposal.
Later in the day, the two sides signed the wage agreement, with management pledging to strengthen the company’s global competitiveness.
“Starting with the conclusion of this wage agreement, labor and management will work together as one to strengthen our global competitiveness,” Yeo Myeong-gu, head of the company’s Device Solutions division’s People Team, said in a press release.
The labor union and management reached the agreement just an hour before an 18-day strike was set to begin at the world’s top memory chipmaker last Thursday.
Labor and management had been deadlocked since late last year over performance-based bonuses tied to earnings from the company’s artificial intelligence (AI)-related semiconductor business amid the ongoing global memory chip boom.
Under the deal, Samsung will allocate a special semiconductor performance bonus equivalent to 10.5 percent of business performance earnings, without a cap.
The special bonuses will be paid in company stock over at least 10 years, based on targets for the chip division to achieve more than 200 trillion won (US$132 billion) in annual operating profit from 2026 to 2028 and 100 trillion won from 2029 to 2035.
Of the total bonus pool, 40 percent will be allocated to the division as a whole, while 60 percent will be distributed to individual business units.
Based on forecasts that Samsung’s operating profit could reach 300 trillion won this year, the agreement could translate into bonus payouts of up to 600 million won for each of the 28,000 employees in the company’s profitable chip division.
Following the signing, the company announced it will create a 5 trillion-won fund over the next five years to invest in future talent development and build an ecosystem supporting its suppliers and underprivileged groups.
“Over the next five years, we will raise a total of 5 trillion won to invest in win-win cooperation and building a healthy ecosystem, as well as nurturing future talent,” according to the statement attributed by company executives.
The move is widely seen as an effort to counter criticism that the company has been distributing massive profits from the semiconductor supercycle as excessive employee bonuses.
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