SK Hynix’s low-annual employee protest triggered… Executives try to evolve
Spread to other companies… Conflicts between divisions within the same company
In addition to the characteristics of the MZ generation to say, activation of communication channels such as SNS also played a part.
(Seoul = Yonhap News) Reporter Kim Young-shin = As internal conflicts over incentives for large corporations have recently spread significantly, they have emerged as a social concern.
Employees’ dissatisfaction with incentives wasn’t the case yesterday, but this year, a toxic problem emerged, and compensation system management and internal communication have emerged as important management tasks for companies.
According to the industry on the 6th, the company that suffered the most serious conflict this time was SK Hynix, but the controversy spread to all industries as well as other large companies such as Samsung and LG.
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SK hynix[000660]Announced at the end of last month that it will pay 20% of annual salary (400% of basic salary), which is an incentive for exceeding performance, which is the 2020 excess profit distribution (PS).
In 2019, due to poor performance, SK Hynix could not give PS at the beginning of last year, but instead provided a’special contribution to future growth’ equivalent to 400% of the basic salary.
Last year, the performance was very good, with operating profit reaching KRW 5 trillion, an increase of 84% from the previous year due to the increase in Corona 19 non-face-to-face demand. .
Particularly, complaints arose in earnest when an employee who had joined SK Hynix for 4 years sent a complaint email to all members, including President Lee Seok-hee.
SK Group Chairman Choi Tae-won announced on the 1st that’return of the annual salary’ and President Lee Seok-hee sent an email to all employees expressing an apology on the 2nd, but the controversy did not subside.
Employees asked to disclose’EVA’ (Economic Value Added), which is used as an index for calculating incentives, but the management was in a position that it could not be disclosed because it was classified as a business.
But Samsung Electronics[005930]SK Hynix retreated as the fluctuations became serious, such as a group turnover to competitors such as Micron and Micron.
SK hynix decided to abolish EVA and link incentives to operating profit through labor-management consultations on the 4th. In addition, the labor and management agreed to issue employee stock ownership so that the benefits equivalent to 200% of the basic salary will be returned and 3 million in-house welfare points will be provided.
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Starting with the labor-management agreement, the controversy over SK Hynix’s incentive pay has truly entered a phase, but the flame has not gone out. This is because the company and the trade union affiliated with the KFTU were not recognized as a formal bargaining organization and did not participate.
The backlash continues, such as reviewing class action lawsuits on the technical office, which means college graduate employees.
It is known that low-year-old employees who send e-mails to all executives and employees are also technical clerical workers, and there is a continuing agitation to move to a competitor in the anonymous community of office workers.
The controversy over performance pay has spread to the issue of discrimination between each business sector, subsidiary, and even business types or large and small companies.
Following SK Hynix, SK Telecom[017670] The union also officially raised a question about last year’s incentives, which were down 20% from the previous year. President Park Jung-ho communicated with employees and paid 3 million points for the Lunar New Year holiday, but the union continues to protest, saying it is a temporary measure.
Samsung Electronics is also in the midst of controversy about performance pay.
In the case of Samsung Electronics, compared to other companies, the amount is higher, and since SK Hynix is so prominent this year, it is said that it only seems relatively less conflict.
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Samsung Electronics recently reported that the DS division in charge of the semiconductor business pays 47% of its annual salary, the IM division in charge of smartphones 50%, the video display division in the consumer electronics (CE) division 50%, and the home appliance division 37%. Announced.
Then, the DS division’s employees, who led the company’s company-wide performance with the most operating profit last year, responded that they did not receive adequate compensation. Employees in the home appliance sector also showed record high performance last year, and are complaining that they are being discriminated against.
The same goes for Samsung Electronics affiliates. When Samsung Display’s OPI payment rate was set at 12%, complaints were said that it was too small compared to Samsung Electronics’ TV video display division (payment rate of 50%).
LG Chem at LG Group[051910]It is said that the employees of LG Energy Solutions, which were recently spin-off from the company, have a lot of complaints.
LG Chem’s petrochemical division is known to receive up to 400% of the basic salary, life science division 300%, and battery business LG Energy Solutions 200%.
Then, LG Energy Solutions employees complained that the battery division achieved a record high performance last year, and that the compensation was less than that of other business divisions.
LG Display[034220]Was unable to pay incentives due to an annual deficit even last year following 2019. Instead, it decided to pay an incentive at the level of 50% of the fixed salary in order to reward for the successive surplus in the third quarter of last year and reduction of the deficit.
LG Electronics[066570]Plans to determine and announce incentives for last year during this month. As employees compare with other companies or business units and express concerns about incentives, LG Electronics is likely to experience similar conflicts.
In the previous year, LG Electronics paid up to 500% of the basic salary to an organization in charge of household air conditioners among home appliances. Employees in the mobile phone business, suffering from a deficit, were given 1 million won in encouragement without incentives.
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In the industry, one of the backgrounds of the growing controversy over performance pay is the characteristics of the MZ generation (a generation born in the late 1980s to 2000s) that values fairness and practicality.
They don’t see the company as a’lifetime job’, so if they think it’s against the principles or principles, they don’t stand it and express their discontent clearly.
In addition, in-house bulletin boards, social network services (SNS), and the office worker community have diversified channels for expressing opinions by office workers, spreading their opinions to the outside quickly, and raising interest.
Companies are complaining about the disclosure of performance-related information related to important management secrets such as the company’s investment plan, but they agree that overall improvement is needed as a result of the controversy this year.
An official of a large company said, “Not only the amount, but also the compensation system, standards, and issues of transparency are increasing,” and “We are improving in the direction of providing information that increases predictability in advance and strengthening communication.”
Some criticize that the controversy over incentive pay is’their own league’ that only applies to employees of some large companies.
Among conglomerates, the oil refining, aviation, and steel industries suffered poor performance from last year’s Corona 19, and there was no or significantly reduced incentives. There are many reactions online that the controversy over performance pay centered on large companies increases the sense of deprivation of small and medium-sized businesses or self-employed.
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2021/02/06 07:00 sent