Why do some Samsung employees cheer company's stock plunge?
Summary
Samsung Electronics shares fell 9.48 percent Thursday, prompting some employees to post online that a lower stock price could benefit them. The reactions relate to a special performance bonus for the Device Solutions division, scheduled for payout in company shares next year. Because employees receive shares after deductions, a lower price at payout could result in more shares. Online users criticized the posts as insensitive to shareholders.
Key Facts
- Samsung Electronics closed Thursday at 210,000 won, down 22,000 won from the previous session.
- The special performance bonus will be funded at 10.5 percent of the Device Solutions division’s operating profit under a labor-management agreement.
- The bonus is scheduled to be paid from late March to early April next year after taxes, insurance premiums and other deductions.
- The company shares employees receive could increase in number if Samsung Electronics’ stock price is lower when the bonus is paid.
Posts about Samsung Electronics' stock price, uploaded Thursday to the anonymous workplace community Blind by users believed to be Samsung Electronics employees / Screenshot from online community
Some Samsung Electronics employees have drawn criticism from online users after appearing to welcome a nearly 9 percent plunge in their company's share price on an anonymous workplace community.
Posts written by Samsung Electronics employees on the company's board on Blind, an anonymous community for office workers, spread across online communities and social media Thursday. Blind requires users to verify their employment through their company email addresses, and displays the name of their employer alongside their usernames.
According to the Korea Exchange, Samsung Electronics closed Thursday's regular trading at 210,000 won ($147), down 9.48 percent, or 22,000 won, from the previous session.
One person believed to be a Samsung Electronics employee posted on Blind under the title, "Please let the stock plunge to 100,000 won."
Another employee wrote a post titled, "Isn't a falling stock price actually better for Samsung Electronics employees?" The employee said, "From the Device Solutions (DS) division's perspective, a higher stock price only increases the risk associated with OPI2," referring to a special performance-based bonus.
The reactions appear to stem from the structure of the special performance bonus that Samsung Electronics employees are expected to receive.
Under a labor-management agreement, funding for the special performance bonus will be equivalent to 10.5 percent of the DS division's operating profit, with the payout scheduled for late March to early April next year. Employees are expected to receive the amount remaining after taxes, insurance premiums and other deductions in the form of company shares.
That means the lower Samsung Electronics' share price is at the time of the payout, the more shares employees could receive.
Online users, however, criticized the employees' reactions.
"No matter what, is there really a need to mock shareholders like that?" one online user said.
Another said, "Shareholders are going through a difficult time because of the stock plunge, so it's bitter to see employees hoping the price falls even further."
This article from the Hankook Ilbo, the sister publication of The Korea Times, was translated by a generative AI system and edited by The Korea Times.
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