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'100-Fold Difference in Bonuses' Triggers Labor Dispute: Samsung Electronics DX Union Files for Injunction to Halt Voting

This article was automatically translated by AI. There may be errors compared to the original Korean article.  Read original in Korean →

[비즈한국] With only one day left until the deadline for the ratification vote on the Samsung Electronics wage agreement, a labor union representing the non-semiconductor sector has filed for an injunction with the court to halt the voting process. The move reflects deepening internal labor conflicts, as frustration grows over a massive, hundreds-of-millions-of-won special bonus concentrated in the semiconductor (DS) division, while the smartphone and home appliance (DX) sectors feel relatively marginalized. With some shareholder groups also challenging the bonus calculation method and pushing for shareholder meetings and lawsuits to nullify the agreement, the conflict is expected to persist even if the deal passes.

The leadership of the 'Donghaeng' union, primarily consisting of employees from Samsung Electronics' Device eXperience (DX) division, submitted an injunction request to the Suwon District Court on the 26th to halt the ratification vote on the wage agreement between the company and labor unions. In the photo, the leadership is answering questions from reporters in front of the Suwon District Court building before submitting the application. Photo = Yonhap News
The leadership of the 'Donghaeng' union, primarily consisting of employees from Samsung Electronics' Device eXperience (DX) division, submitted an injunction request to the Suwon District Court on the 26th to halt the ratification vote on the wage agreement between the company and labor unions. In the photo, the leadership is answering questions from reporters in front of the Suwon District Court building before submitting the application. Photo = Yonhap News

Allegations of Unfair Representation and Challenges to Legitimacy

The 'Donghaeng' Union (the third union, mainly representing non-semiconductor employees) held a press conference on the morning of the 26th after filing for an injunction with the Suwon District Court to "suspend the ratification voting process and prohibit the exclusion of voters." Chairman Park Jae-yong stated, "The representative union of the joint bargaining group failed to recognize the equality rights and voting rights of the minority union," adding, "We will fight to the end for the marginalized DX division members."

Donghaeng claims that the joint bargaining group, composed of the Samsung Group's Super-Enterprise Labor Union (Super-Enterprise Union) and the National Samsung Electronics Union (NSEU), unilaterally restricted their voting rights while preparing the tentative agreement, thereby violating the duty of fair representation under the Trade Union Act.

Donghaeng is composed primarily of employees from the DX division, which handles smartphones, home appliances, and TVs, and has about 13,000 members. Although they initially participated in wage negotiations as part of a joint struggle committee with the Super-Enterprise Union and the NSEU, they broke away after alleging that the negotiations were being skewed toward the semiconductor business and that DX division interests were not being properly reflected.

Donghaeng claims that while the Super-Enterprise Union requested their participation in the ratification vote immediately after the announcement of the tentative agreement, they suddenly informed Donghaeng that they had "no voting rights" just days before the vote. Donghaeng argues this behavior is a violation of the duty of fair representation and an abuse of discretion under labor law.

Donghaeng expects that the court could hold a hearing and issue a ruling before the vote concludes at 10:00 AM on the 27th. If the court grants the injunction, the ongoing voting process would be temporarily halted, leading to unavoidable controversy over the validity of existing votes. Aside from this injunction, Donghaeng has announced plans to file for a stay of execution on the vote's validity, a lawsuit to nullify the vote, and complaints regarding the violation of fair representation. Even if the tentative agreement is passed, further legal battles appear inevitable.

Voter Turnout Exceeds 90%… 'Ongoing' Marginalization of DX Division

The ratification vote within the joint bargaining group is proceeding smoothly with a high participation rate. The vote, which began at 2:00 PM on the 22nd, had reached a combined turnout of over 90% by this morning, with the Super-Enterprise Union (57,305 eligible voters) recording 90.81% and the NSEU (8,187 eligible voters) recording 84.76%. Voting continues until 10:00 AM on the 27th, and the agreement will be finalized if more than half of the eligible voters participate and approve it.

Voting requirements have effectively been met. Analysts suggest that since 80-90% of the Super-Enterprise Union members belong to the DS division, and Donghaeng is excluded from voting, the agreement is likely to pass. Choi Seung-ho, chairman of the Super-Enterprise Union, stated today, "Members can check the results immediately after voting ends on the 27th, and we will announce the results collected around 10:30 AM through the joint bargaining group."

Samsung Electronics Suwon Headquarters. While employees in the Semiconductor (DS) division receive special management bonuses of up to hundreds of millions of won, those in the smartphone and home appliance DX division receive only about 6 million won, escalating the bonus-related labor conflict into a legal battle. Samsung Electronics Seocho Office in Gangnam-gu, Seoul. Photo = Reporter Park Jung-hoon
Samsung Electronics Suwon Headquarters. While employees in the Semiconductor (DS) division receive special management bonuses of up to hundreds of millions of won, those in the smartphone and home appliance DX division receive only about 6 million won, escalating the bonus-related labor conflict into a legal battle. Samsung Electronics Seocho Office in Gangnam-gu, Seoul. Photo = Reporter Park Jung-hoon

At the core of this conflict lies the disparity in performance bonuses by business unit. The tentative agreement maintains the existing Overall Performance Incentive (OPI) while introducing a new 'special management bonus' for the DS division. This special bonus is funded by 10.5% of the business performance agreed upon by labor and management, with no set payout cap.

Calculations show that if Samsung Electronics achieves an annual operating profit of 300 trillion won this year, an employee in the DS Memory Business Unit could receive around 600 million won in total bonuses—consisting of approximately 550 million won in special management bonuses and the existing OPI. Even non-memory business units like System LSI and Foundry, which are expected to post losses this year, are expected to receive about 160 million won in special management bonuses, distributed from 40% of the common DS division funds.

Conversely, DX division employees will receive only 6 million won in company stock (in the form of a mutual growth fund) excluding the existing OPI. This represents a 100-fold disparity compared to the Memory Business Unit. Donghaeng emphasizes that the voices of the 50,000 DX division employees (as of the end of last year) have been excluded from this ratification vote.

Some employees in the non-semiconductor sector also filed for an injunction on the 15th at the Suwon District Court to halt the 2026 wage and collective bargaining, protesting that the joint bargaining group failed to properly follow procedures, such as general meeting resolutions, when finalizing their demands.

With the backlash from the DX division and legal offensives from shareholder groups, prospects for a complete resolution to the Samsung Electronics bonus conflict appear dim even after the agreement is ratified. However, the 'Korea Shareholder Movement Headquarters' announced today that it would postpone its lawsuit to nullify the bonus agreement to monitor the results of Donghaeng's injunction.

The group argues that calculating bonuses based on operating profit before corporate tax is an illegal act that bypasses taxation authority, and that since the right to distribute profit after tax belongs to shareholders, bonus plans should require shareholder approval. They have also begun efforts to secure a list of shareholders to convene a general meeting.

The Shareholder Movement Headquarters told the press on the 26th, "We are aware that Donghaeng is pursuing an injunction to halt voting," adding, "Since the target of our nullification lawsuit may change depending on the outcome of the union's injunction, we have decided to postpone it for now."

This article was automatically translated by AI. There may be errors compared to the original Korean article.
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