Samsung Electronics Co and its largest labor union have tentatively agreed to a 5.1 percent wage increase and stock awards for staff this year, signaling efforts by the two sides to defuse tensions that triggered the company’s first-ever labor strike last year.
Under an initial agreement, Samsung would for the first time give 30 shares of the company to all employees — equivalent to about US$1,200 at yesterday’s closing price. Other perks include allowing each employee to purchase 2 million won (US$1,400) worth of Samsung’s electronics products at a discount, Samsung and the union said in a statement yesterday.
The National Samsung Electronics Union, which has about 37,000 members, is to vote on the preliminary agreement from Friday to Wednesday next week. The company is taking a step toward resolving labor tensions at a time when it is ceding market share to rivals in several key arenas. Samsung’s shares slid 1.6 percent in Seoul yesterday,
Photo: AFP
South Korea’s largest company lost more than one-third of its market value last year after failing to close the gap on SK Hynix Inc in the contest to sell advanced memory for Nvidia Corp’s artificial intelligence (AI) accelerators. It is also facing heightened competition in smartphones and other consumer electronics from Chinese rivals.
Among measures agreed upon initially, Samsung would begin a policy to rehire retirees with three or more children — reflecting the higher education costs such employees face and addressing domestic challenges.
South Korea has one of the world’s lowest birthrates, at just 0.72 children per woman in 2023.
The government is pouring more than 380 trillion won into baby-boosting incentives, including subsidies for prenatal care and monthly cash payments for families with children up to five years old.
Other companies are joining the endeavors. Booyoung Group, a housing construction company, began giving 100 million won to each employee who has given birth since last year. Gaming company Krafton Inc is planning to offer similar cash payments to staff.
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