Samsung's First-ever Flexibility Proposes 10% of Operating Profit as Bonus

According to a report by South Korea's Herald Economy, Samsung Electronics is facing the largest scale strike threat since its establishment, as the deadlock between the labor and capital sides remains over performance bonuses. The capital party has recently taken the initiative to release signals for a compromise, proposing to use 10% of operating profits for performance bonuses, consistent with the standard of its competitor SK Hynix, and willing to fix this system in writing, with formal institutionalization three years later - this is the first significant softening on the part of the capital party regarding institutionalization issues.

From an absolute amount perspective, the actual scale of the capital party's proposal is not small. Samsung Electronics is expected to have operating profits of about 350 trillion won this year. Calculated at 10%, the performance bonus pool would amount to 35 trillion won, far exceeding the 20 trillion won scale of SK Hynix, and also equivalent to about three times Samsung's total dividend last year.

However, the super enterprise union refuses to accept. The union believes that since Samsung's operating profit scale is higher than that of SK Hynix, it is hard to accept the approach of "being first, but only on the second standard," demanding that the bonus proportion be raised to 15% of operating profits, and also demanding immediate formal institutionalization and the abolition of salary caps. The union also criticizes the capital party's practice of holding separate meetings with the memory business department as "dividing and breaking," calling on members to persist in striking. Currently, about 30,000 union members have expressed their willingness to participate in the strike, while the capital party denies having held explanatory meetings specifically for the memory business department.

Amidst the tense situation, the South Korean government has already directly intervened. The Gyeonggi Provincial Labor Minister responsible for Samsung Electronics affairs will meet with the union chairman, and the Central Labor Committee is also in contact with both labor and capital parties, exploring the possibility of launching a "post-mediation" procedure. During the first strike by Samsung Electronics' union in July last year, the Central Labor Committee intervened in the same way. Although it did not directly lead to an agreement, it created conditions for the resumption of autonomous negotiations between labor and capital.

The semiconductor industry's economic recovery makes the potential price of this dispute more prominent. If the strike becomes a reality and leads to production interruption, it will not only affect Samsung's own shipment rhythm but may also have a ripple effect on South Korea's overall exports and investment sentiment.