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| Unionized workers at Samsung Electronics apply to the National Labor Relations Commission for arbitration, at the Government Complex Sejong, Friday. Yonhap |
By Park Jae-hyuk
Performance-based bonuses have become a major source of conflict between management and workers at Samsung and LG.
Last Friday, unionized workers at Samsung Electronics asked the National Labor Relations Commission for arbitration, as they have failed to reach an agreement with management over the wages for 2021. If the 10-day arbitration does not lead to an agreement, the union will have the legal right to go on strike ― something that has never been seen before in the company's 53-year history.
Samsung Electronics' management said it will continue to hold talks with workers, but has refused to accept the union's request for a 10 million won ($8,400) increase in each employee's annual salary and payment of performance-based bonuses equivalent to 25 percent of the conglomerate's operating profit. The company's joint labor-management council had agreed last March to raise the base salary for 2021 by 4.5 percent and the performance-based bonus by 3 percent.
Unionized workers at Samsung Welstory have also held rallies in front of the company's headquarters to protest management's refusal to pay performance-based bonuses this year. The workers have asked management to share the company's record-high revenue last year, but the management has cited the Fair Trade Commission's imposition of a 96 billion won fine last June as the main reason for its refusal.
Workers at LG Electronics, who had complained last year about the difference in the size of bonuses paid to each business department, complained online recently to CEO Cho Joo-wan, who remained reluctant to mention the specific size of the performance-based bonuses that are expected to be paid out later this month.
LG Chem, which paid its employees performance-based bonuses last month, reportedly raised the size of bonuses more than initially planned, after facing protest from employees, who asked management to share the profits from the initial public offering of LG Energy Solution.
At the same time, minority shareholders of Samsung and LG subsidiaries have expressed concerns about the possibility of higher salaries reducing shareholder returns. The Korea Enterprises Federation also stated in a report that an unreasonable wage hike could hinder a company's global competitiveness and intensify economic polarization.
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