Samsung Electronics Reaches Last-Minute Labor Deal, Averting Strike; Employees Could Earn Up to NT$14 Million in Bonuses

(CNA, Seoul, 21st, Comprehensive Foreign Report) Labor and management at South Korea's Samsung Electronics reached a preliminary agreement today, suspending a planned strike and causing the company's stock price to surge in early trading. According to the agreement, employees in the Device Solutions (DS) division of the semiconductor business could receive performance bonuses of up to 600 million won (approximately NT$14 million) this year. According to reports from Reuters and Yonhap News Agency, the Samsung Electronics union stated that this last-minute preliminary agreement will be put to a vote by union members between May 22 and May 27. During this period, a planned 18-day general strike by nearly 48,000 employees will be suspended. Under the "2026 Preliminary Performance Bonus Agreement" signed by both parties, Samsung will allocate an additional 10.5% of its operating profit, on top of existing year-end performance bonuses, as a special semiconductor performance bonus for the DS division, with no upper limit. Of this, 40% will be allocated to the DS division and the remaining 60% to sub-departments. Industry forecasts predict that Samsung Electronics' operating profit this year could reach 300 trillion won (approximately NT$7.1 trillion). If the agreement is fulfilled, the special semiconductor performance bonus could amount to as much as 31.5 trillion won (approximately NT$745.6 billion). Each employee could receive up to 540 million won (approximately NT$12.78 million) in performance bonuses in the form of treasury stock, and with existing bonuses, they could receive up to 600 million won. The Korea Composite Stock Price Index (KOSPI) surged 5.3% this morning. Ryu Young-ho, a senior analyst at NH Investment & Securities, stated that investors are relieved by the dissipation of uncertainty surrounding the strike. However, he believes the agreement is not entirely positive for investors, as Samsung may need to set aside 'provisions' related to increased labor costs in the future, which would compress operating profits. (Compiled by: Chang Ming-hsuan) 1150521