Delay of Annual Promotion Unnerves Samsung Employees

By Cho Jin-seo

Staff Reporter

The ongoing independent probe of Samsung Group's alleged corruption and tax evasion is suspending its annual promotion process, worrying not only high-ranking executives suspected of crimes but also low-level employees who were expecting salary raises this month.

Until last year, Samsung's subsidiaries have usually shuffled their top management positions around January, and then the process moved down to managers and assistant managers in March along the corporate hierarchy. But this year the announcement is being indefinitely postponed.

``The delay in the promotion process is related to the prosecutors' investigation,'' said Yim Jun-seok, spokesman of Samsung Strategic Planning Office. ``(The investigation) has been preventing us from making some important decisions in management, and this is one of those decisions.''

While most high-ranking officials who have spent many years at Samsung are taking the delay for granted at least on the surface, some young employees were disgruntled for not getting the salary raise and perks they were supposed to get this month.

``I was told that I won't get a promotion until the executives promotions are settled, and we don't know when that will happen,'' a mechanical engineer working at Samsung Electronics' Suwon R& D center said Thursday. He demanded anonymity. ``I understand that management cannot promote executives because some of them could be involved in scams. But as for ordinary employees, there was no need to wait, I think.''

A group of specially designated prosecutors has been questioning former and current Samsung executives, including Chairman Lee Kun-hee's son Lee Jae-yong, on alleged shady dealings involving the group's corporate structure. They are also looking into hundreds of bank accounts suspected of being used in creating slash funds to bribe politicians, prosecutors, tax officials and journalists.

Like most other conglomerates in Korea and Japan, Samsung has a seniority-based pay system for low-level employees until they reach a managerial level. A post-graduate degree shortens the period by two to eight years. Few employees fail to make assistant manager in four years and few make it in less than three years, the workers say.

Some employees suspect that management is trying to use the situation as a chance to raise sympathy for Samsung, which can encourage politicians to put pressure on the special prosecutors' investigation. A number of newspapers (especially economic ones) have already asked the prosecution to give a partial pardon to Samsung, saying that the months-long scandal is hampering Samsung's operations in and out of Korea, in turn damaging the Korean economy.

``The promotion process is computerized, so all they needed was a click on the HR system. I think they are deliberately not doing it in order to sway public opinion,'' said an employee of Samsung Electronics' Seoul headquarters, who was supposed to get a promotion and salary raise of several million won per year. ``They said that they won't promote us until the investigation ends in May. I doubt that I will be compensated for the loss of salary.''

Samsung's spokesman Yim said that there is not yet any plan for retrospective compensation.

indizio@koreatimes.co.kr