[Samsung SDS Establishes First Union Amid Controversy Over Performance-Based Pay Reform] Samsung SDS in South Korea has officially established its first labor union since the company's founding. It is believed that recent internal conflicts surrounding performance-based pay system reforms led to the union's formation. It is anticipated that labor disputes over the pay system reform will intensify in the future. Industry sources revealed on the 6th that the "Samsung SDS Branch," a branch of the Samsung Group's inter-company labor union, announced its establishment and began accepting membership applications. Within just two hours of its establishment, nearly 2,000 employees had joined. Samsung SDS is currently pushing to abolish the existing cash-based "Target Incentive" (PI) system and instead implement a performance-based pay scheme, distributing up to 20% of annual salary in the form of company stock. The company is currently holding an all-employee vote on the plan, with the voting deadline extended from the original June 29th to July 7th. Employees opposing the reforms point out that the company began adjusting the performance-based pay system without sufficient explanation or consultation with employees. Their objections included: 70% of performance-based compensation metrics were linked to external indicators such as stock price and industry indices, and existing target incentive bonuses were excluded from retirement benefit calculations. Furthermore, some employees protested, claiming the company pressured them to vote in favor of the plan.
