The Donghaeng union, which represents workers in Samsung Electronics' Device Experience (DX) division covering home appliances, televisions and smartphones, held a rally Friday demanding 1,000 treasury shares per employee and the creation of a company-wide bonus pool that would allow all workers to share in overall corporate performance.
At the rally near Samsung Electronics' Seocho-gu headquarters in Seoul, union members said products are selling at record levels while workers are being told the company is in the red. "The company is shifting all responsibility for its management failures onto employees," they said.
The union called on the company to explain "why executives are rewarded based on company-wide performance while employees are told to fend for themselves by division, and why the cost of failed management decisions is being passed on to workers in the form of cost-cutting and headcount reductions."
The union argued that management bears direct responsibility for the DX division's deteriorating profitability, including the MX mobile business unit's slide into the red. It said the rise in memory chip prices — a key factor behind the margin squeeze — was a foreseeable variable, yet management failed to defend costs through long-term supply contracts or supply chain management.
Earlier, Samsung Electronics reached a labor-management agreement in May under which workers in the semiconductor DS division would receive a special performance bonus, while DX division employees and others would each receive 6 million won ($4,310) worth of treasury shares. Depending on each division's results, the performance pay gap between the two sides widened to as much as 100-fold.
Adding to the discontent, DX division chief Roh Tae-moon, who also serves as co-CEO, had again invoked the performance-based pay principle by describing the DS and DX divisions as "two companies under one roof."
Son Jong-hyeon, acting chairman of the Donghaeng union, said the company "sometimes calls itself one company when it suits them, and a different company when it doesn't, all while passing management responsibility onto every employee." He added: "While division tears us apart, a tiny handful of executives sit back and enjoy the spoils. We will now reclaim the 'One Samsung' that the late chairman — Lee Kun-hee — built and led."
About 3,500 people attended the rally. Before the main event, union members marched near the Seocho headquarters chanting slogans including "Park Hak-gyu and Jeong Hyeon-ho must resign," "Take responsibility for management failures," "Explain record sales and record losses," and "Employees get pushed out, executives live in luxury."
On the rally stage, a banner bearing a photo of Samsung Electronics Chairman Lee Jae-yong read: "Chairman Lee Jae-yong, please listen to the voices of DX employees." Nearby, a funeral wreath was displayed with the inscription: "We mourn the passing of Samsung Electronics' DX division." A head-shaving ceremony was also held to press management accountability.
The union put forward three demands: 1,000 treasury shares per DX division employee, the creation of a common bonus pool funded by a fixed share of company-wide performance, and the uniform application of base salary increases across the entire company.
However, some critics argue that the demand for 1,000 treasury shares per worker — which could total around 12 trillion won in aggregate — is excessive given the DX division's worsening profitability.
In response, the union argued that profits generated during the DX division's boom years were not paid out as additional performance bonuses but were reinvested into other businesses such as semiconductors to strengthen overall competitiveness, and that the 1,000-share demand reflects commensurate value.
"This is not simply a tantrum demanding 'give us as much as the DS division,'" the union said. "If the 1,000-share demand is judged excessive, we are willing to have the company present objective criteria for evaluating contributions and verify them together."
The union also described the proposed common bonus pool as a mechanism to gradually reduce the performance pay gap arising from the differing business cycles of the semiconductor and finished-product industries. It called for a structure in which a fixed share of company-wide performance is set aside in a common pool and used to supplement divisional performance pay, creating a virtuous cycle across business units.
Meanwhile, questions have been raised about the legality of the rally, given that a wage agreement had already been reached and the union had not secured separate legal strike rights. Under current labor law, a lawful industrial action requires a breakdown in labor-management negotiations, a mediation process before the National Labor Relations Commission, and a membership vote.
On this, the Donghaeng union said the rally does not constitute an industrial action, as members attended voluntarily using their own annual leave or the company's internal discretionary day-off system known as "D-Day."
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