Business

Samsung will cut bonuses for mobile division employees

The Galaxy Note 7 could have done wonders for Samsung’s fortunes but it has ended up costing the company billions of dollars. While heads are yet to roll at the company’s mobile division, Samsung has reportedly decided to cut bonuses for its mobile division employees. Since bonuses are tied to the division’s annual profits and the Galaxy Note 7 has taken a substantial chunk out of them, the employee bonuses will be impacted in a similar fashion.

Samsung’s OPI reward program for employees pays up to 50 percent of their annual salaries as bonuses as long as they fall within 20 percent of the company’s excess profits. Samsung is due to dish out OPI incentives on January 26, 2017. According to local media reports from South Korea, the bonus percentage for the mobile division employees has been reduced from 50 percent to just 17 percent. The cut has primarily been made due to the Galaxy Note 7 recall.

Employees of the company’s mobile division have enjoyed receiving bonuses at the maximum rate of 50 percent for the past few years due to strong smartphone sales. This is the first time in almost six years that the bonus percentage has fallen below 20 percent. On the other hand, employees of Samsung’s memory division are expected to receive 50 percent of their salaries as bonuses.

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Martin DAYI
Martin DAYI

I hope they get the bonus rates returned to the original rate just after the S8’s success. Aside from a minor aggressive battery spacing issue, Note 7 is seen as the best by many, even though there are very strong players like Apple in the market. That’s something.

maccyb
maccyb

They should pay the bonuses to customers like me who had so much trouble with having to return 2 phones in 2 months. Lol. But seriously, this is good motivation for employees to get it right next time. And hopefully us loyal customers who stayed with Samsung through all this will get a great deal on the S8 and Note8.

ctdog4748
ctdog4748

They shouldn’t get any bonus at all, the Note 7 debacle was a massive f-ck up.

stondec
stondec

The Note 7 issue was more of a PR Kamikaze than an actual faulty phone. Samsung should fire all their PR team that catastrophically mangled the Note 7 issue in a manner that’s tantamount to knee-capping the company. Instead of deescalating the situation, they managed to magnify a minor problem into a major crisis.

maccyb
maccyb

I’m a loyal customer for many years, including the Note7, , two of them. But I have to admit the comment about this being a massive f- up is correct. It wasn’t a PR problem, it was a faulty device, plain and simple. Yes, it wasn’t many devices but more than was considered safe, particularly as they couldn’t find the cause for so long. We will hear the reason soon. The phone isn’t safe. Get over it. Samsung are not stupid, if there was any other way to handle, they would have.

jpd514
jpd514

I share your opinion “they managed to magnify a minor problem into a major crisis”

Samsung is learning but they pay the big price

Syclone Rob
Syclone Rob

Yup, you are one of those that think that samsung can do no wrong. You need to lessen the grip of samsungs ball sack and see how it really is.