The effect of the coronavirus outbreak on businesses has started to emerge. Companies around the world have halted production in their manufacturing facilities to fight the further spread of the virus. Due to this, their estimated profit margin has dropped for this year, which has now led them to lower the wages of their employees. A fresh report from South Korea says Samsung and LG have already finalized a lower pay raise for its workers this year.
Samsung and LG are some of the largest manufacturers of consumer electronics products. They have businesses in every nook and corner of the world. When such large companies shut down their manufacturing facilities, the loss they incur is too high. COVID-19 pandemic has created such a tense situation for them and as a result, both the companies have decided to lower the pay raise for its employees this year, reports The Korea Herald.
In 2018 and 2019, Samsung’s pay raise for its workers was 3.5 percent. But now, this year, it has been decremented to 2.5 percent, which is exactly 1 percent lesser than the previous years. However, the raise is the salary of the employees may vary as it depends on an individual’s performance. The above-mentioned number is the standard base salary raise. On the other hand, LG workers received a 4.3 percent pay raise last year, whereas the amount will be decreased by 0.5 percent, down to 3.8 percent in 2020.
Additionally, the report also says that the management and trade union of both the companies have confirmed to agree upon the change in pay raise. Thus, it is official that Samsung and LG will be indeed paying out a lower amount of salary to their employees this year.
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