New Delhi: Samsung Electronics’ management and its employees have agreed to an average 4.1 percent pay raise for the year, while effectively freezing raises for its board members amid poor performance amid a recession and global recession. The wage increase is less than last year’s 9 percent wage increase, which was the highest in a decade, and less than initial demand from workers.
The world’s biggest memory chip and smartphone maker reached an agreement with its workers’ representatives on wages and other labor policies, including reducing working hours for pregnant workers. ,ALSO READ: Amazon, Google CEOs ‘hint’ at more layoffs amid economic slowdown,
The announcement was made internally earlier in the day, according to sources, reports Yonhap news agency. The two sides reached a settlement keeping in mind the external headwinds, which led to a quarterly profit drop of nearly 96 percent in the first quarter. ,Also Read: AI-Based Smartphone App Can Help You Quit Smoking,
The management decided to implement last year’s salary policy for board members, effectively postponing its initial plan to raise the salary cap for board members by 17 percent.
Separately, Samsung’s unionized workers, who account for about 4 percent of its total workforce of 110,000, have been engaged in wage negotiations with management since late last year.
So far 10 rounds of talks have taken place between the two sides, but the differences could not be resolved.
Last week, Samsung said it would cut memory production in the short term after its quarterly profits fell significantly (a potential 96 percent) amid chip declines, in a sharp departure from its previous position that it was artificially reducing production. Will not
The world’s biggest memory chip and smartphone maker forecast its January-March operating profit at 600 billion won ($454.9 million), down significantly from 14.12 trillion won a year earlier.
Samsung attributed the poor performance to sluggish demand for tech devices coupled with inventory adjustments by customers.