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Samsung SDS's proposed overhaul of its incentive system—which included paying part of employees' annual salaries in company shares—was ultimately voted down in an internal employee ballot.
According to the information technology (IT) industry on the 8th, Samsung SDS announced the results of the employee opinion vote on the personnel system overhaul, which concluded the previous day. The turnout was 55.6%, and the approval rate among those who voted was 71.9%. However, the final approval rate based on all employees came to 40%, falling short of the majority approval required to implement the personnel system overhaul.
The overhaul centered on consolidating the Productivity Incentive (PI), previously paid twice a year, with the existing Profit Sharing (PS), and paying incentives in company shares instead of cash. The level of company shares was to be set at 20% of annual salary. When the plan was announced, some Samsung SDS employees pushed back, arguing that the incentive structure would become highly volatile depending on the stock price and that compensation standards would be leveled out across all employees.
In this process, employees established a labor union on the 6th of this month—the first in Samsung SDS's history—to organize their opposition to the personnel system overhaul. The Samsung SDS union was organized as a branch under the Samsung Group's Super-Enterprise Union. On the 7th, it also demanded collective bargaining with Samsung SDS CEO Lee Jun-hee. As of the morning of the 8th, the number of members wishing to join the Samsung SDS union exceeded 6,000, securing a majority of Samsung SDS's total workforce (about 11,000 employees) as members.
The Samsung SDS union said, "We will continue our demands for dialogue, including collective bargaining with management, and will build up the union's organization."
