Samsung workers vote on hefty pay and bonus package

Members of the Samsung union are voting on an annual bonus worth the equivalent of several hundred thousand dollars per person after a deal was struck with the firm’s bosses to avert a strike, South Korea’s state news agency Yonhap reported on Friday.

The vote on a settlement presented by management is to continue until May 27, Yonhap said.

The compromise includes an average pay rise of 6.2% and the distribution of 10.5% of the company’s profit to the workforce.

Forecasts suggest this year’s bonuses for employees in the semiconductor division could amount to up to 600 million won (about $400,000) per person. The union is considered likely to approve the deal.

Previously, around 48,000 unionized employees at the world’s largest producer of memory chips had threatened an 18-day strike. The strike call was prompted by anger at the level of bonus payments to the workforce after the South Korean electronics giant posted record profits amid a boom related to artificial intelligence chips.

Operating profit for the first quarter alone totalled 57.2 trillion won ($38 billion) – about eight times more than a year earlier.

In an internal report, South Korea’s central bank estimated that a strike at Samsung could have slowed the country’s economic growth this year by 0.5 percentage points.

The US Chamber of Commerce in South Korea also issued a warning saying the strike could disrupt global supply chains and damage South Korea’s reputation as a reliable technology and manufacturing hub.