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“I wasn’t interested in promotion and I was satisfied with my salary. But at some point, it piled up. I cried during the high school term.” (Employees in their 30s with less than 5 years of experience at Samsung SDI) “The smart person got an ‘E’ (lowest rating). How is your heart A person becomes a bear. It’s just that I’m a bear, like this.” (Samsung Electronics workers in their 50s with 20 or more years of experience) While the government is pushing for a reform of the salary system based on jobs and performance, a report has ‘to publish for the first time examining the impact of Samsung’s pay system, which emphasizes differential compensation based on performance, on employees.The survey revealed distrust, discouragement and disappointment in the company due to the difficulty of objectively measuring performance. In addition to causing mental stress to employees, there were also inefficiencies that did not contribute to organizational productivity.On the 6th, the National Union of Metalworkers (Undeg Gewirheit Metel) published a report, ‘Samsung Performance Evaluation System’, based on the results of a survey of 445 of Samsung Electronics and Samsung SDI employees last year and an interview of 22 Current Status and Harm Study: Focusing on Samsung Electronics and Samsung SDI’. Distributed py the survey was equally divided among production workers (34.4%), office and research and development workers (62.5%), trade union members (47.4%) and non-union members (52.6%). Survey participants recognized Samsung’s pay system as one that ’emphasises results rather than process’ (70.4%) and ‘salaries vary greatly even in the same position’ (85.6%). It is a typical performance based system where individual or team performance is graded and rewarded differently. Until the early 1990s, Samsung’s personnel system, which had slogans of ‘lifelong work’ and ‘one family’, is known to have expanded based on performance with the introduction of an annual salary system in 1998 and a divisional profit distribution system business in 2000. Employees are graded in 5 steps, from EX (Excellent, A), the highest, to UN (Unsatisfactory, E), the lowest, according to performance. Going beyond the level of temporary pay differences based on performance, it also affects the base salary and the annual salary, which are the standards for salary increases, and the pay gap widens cumulatively.

First of all, employees saw that there was a problem with ‘appraisal fairness’. 75.1% responded negatively to the sentence ‘Current performance appraisal is reliable’. Interviewees mentioned that middle managers who have the authority to evaluate use incomprehensible criteria such as ‘regional feel’, ‘do they attend drinking parties’, ‘help with their spare time to farm’, and ‘easygoing people ‘. The opaque evaluation criteria gave good evaluations based on the promotion procedure, or appeared inefficient as “replacing things that worked well to produce results” (Samsung SDI employees). Above all, in the process of ‘relative evaluation’ (only production workers from 2023), which sets the number of people according to grade, the side effects of giving low grades to women, those on parental leave, and’ those on sick leave as well. Workers said, “I didn’t test because I took time off because I got corona” (free opinion from the survey) “Don’t you know, if you look after a woman, you get curse? He said this.” (SDI Samsung employee). Choi Min, a permanent activist at the Korea Labor Safety and Health Research Institute, explained, “Discrimination in society seemed to be directly reflected in the performance evaluation results of employees.” Among those who responded to the survey, 70% of workers said they had experience of working even when they were sick. 65.3% of respondents answered negatively to the sentence ‘performance appraisal motivates employees’. One of the advantages of the performance based pay system is that it is possible to motivate employees by stimulating the competitive spirit, but the result contradicts this claim. Jeong Heung-joon, professor of business administration at Seoul National University of Science and Technology, said, “The government talks about a performance-based pay system, but it’s hard to say that only a certain pay system is correct .” need research and consideration,” he said. Correspondent Bang Jun-ho whorun@hani.co.kr