Samsung chip workers have landed a monster AI payday after forcing through a profit-sharing deal worth nearly $400,000 each.
According to the Financial Times, workers at Samsung Electronics have approved a landmark profit-sharing agreement after months of squabbling over the spoils from the AI memory chip boom.
The deal passed on Wednesday with 74 per cent of the company’s labour union voting in favour. The union had threatened strike action if the world’s biggest memory-chip maker kept sitting on the cash.
Under the agreement, 78,000 semiconductor workers will receive 10.5 per cent of Samsung’s operating profit. That means a bonus pool of more than Won34tn, about €19.4bn, based on a KB Securities forecast of Won327tn, about €186.7bn, operating profit this year.
That comes on top of 1.5 per cent already handed out through existing bonus schemes.
About 40 per cent of the chip bonus pool will be shared equally. The rest depends on how each business unit performs.
Memory-chip workers are expected to receive Won 600mn, about €342,600 each. Staff in the loss-making contract chipmaking and logic-semiconductor design businesses are likely to receive between Won150mn and Won200mn, about €85,600 to €114,200.
The deal follows a similar agreement at South Korean rival SK Hynix last year. Its workers were promised 10 per cent of operating profits for the next 10 years. That would mean an average bonus of Won710mn, about €405,400, for each of SK Hynix’s 35,000 workers, based on projections of an operating profit of Won250tn, about €142.8bn.
Both companies are cashing in on demand for high-bandwidth memory chips used in AI systems. Samsung recently became the first South Korean company to reach a $1tn market capitalisation.
SK Hynix joined it on Wednesday, while US chipmaker Micron closed above the $1tn level in New York on Tuesday.
Samsung is not a pure chipmaker, which makes the bonus split more painful for some staff. Workers in its DX division, which makes smartphones, televisions and other gadgets, will receive about Won6mn, about €3,400, according to a person close to the company.
The DX division is being squeezed by Chinese competition and higher chip prices. Those same higher chip prices are making Samsung’s semiconductor division look smug.
Two Samsung labour unions made the agreement with the company. A smaller third group, the Samsung Electronics Company Union, mainly made up of DX members, had requested a court injunction against it.
National Samsung Electronics Union acting president Woo Ha-kyung expressed regret over “the sense of exclusion felt by DX employees, as well as the dissatisfaction within DS [the semiconductor division] caused by differences in compensation”.
“DS also experiences downturns, If the bargaining structure begins to fragment according to short-term business performance and divisional interests, our ability to support one another during future crises will inevitably weaken,” he said.
Samsung relies on tens of thousands of subcontracted workers who are not directly hired by the company. They are not covered by the profit-sharing agreement, because capitalism still likes a trapdoor.
South Korea’s labour market is often described as two-tiered. Unionised workers at conglomerates earn high wages and generous benefits, while supplier and subcontractor staff usually earn less and have weaker job security.
