Samsung has a tradition of offering year-end bonuses to employees across the entire organization to thank them for a job well done. When times have been good for the company, it has given significant incentives to employees to boost their morale.
The past year hasn't been great for the company financially as it suffered a significant profit decline due to the lackluster performance of its semiconductor division. This has made it necessary for the company to cut bonuses altogether.
Samsung's chip division gets no bonuses this year
According to reports, employees of Samsung's chip division won't get any bonuses this year due to the significant decline in profits for the division. Things aren't as drastic in Samsung's other divisions. They'll receive payouts as part of this incentive program that the company calls its Overall Performance Incentive (OPI).
The company is providing employees of the mobile division between 46-50% of their yearly salary as a bonus. Those in the TV division are expected to receive between 39-43% whereas employees in the home appliance division will get 10-12% of their yearly salary as a bonus.
Despite challenges, Samsung did give employees of the chip division a bonus in January 2023. They received a maximum of 50% of their annual salaries as the bonus. However, given the steep decline in profits over the past four quarters, it appears that Samsung had to cut the bonuses altogether for the chip division.
It's no surprise that Samsung's semiconductor division is feeling the crunch even as it has long been an absolute cash cow for the conglomerate. Samsung's bottom line has been hurt by the supply glut in the memory market and the resulting fall in the average selling price of memory chips. The company does expect the situation to improve starting this year, hopefully bringing back days when this division was making money hand over fist.
