[Exclusive] LG Innotek's Performance Bonus Celebration Up to 400%

[Asia Economy Reporter Ki-min Lee] LG Innotek, which achieved record-high performance last year, will pay performance bonuses exceeding 400%. This is thanks to significantly improved results due to strong sales of Apple’s smartphones, its client company. This contrasts with other LG Group affiliates that are struggling with performance bonus negotiations.

According to industry sources on the 12th, LG Innotek plans to pay performance bonuses to employees around the 21st. The bonuses are set between a minimum of 150% and a maximum of 413% of the base salary, depending on the business division. The PS Division, a semiconductor parts department under the PCB Materials Business Unit, receives the highest bonus at 413%. The DS Division, a display parts department under the PCB Materials Business Unit, receives the second highest at 412%. The Optical Solutions Business Unit and the Electronic Components Business Unit follow with bonuses of 372%.

However, the Vehicle LED Business Unit, which has poor performance due to market deterioration caused by Chinese-made LEDs, receives 201%, and the LED Business Unit and the Automotive Components Business Unit receive encouragement bonuses at around 150%. Bonuses exceeding 400% of the base salary are known to be the highest ever. This is due to last year’s record-breaking performance. LG Innotek’s sales last year were KRW 8.3021 trillion, and operating profit was KRW 403.1 billion, up 4% and 53% respectively from the previous year.

LG Innotek’s performance bonuses stand out even compared to other LG Group affiliates. Unlike LG Innotek, other LG Group affiliates are expected to have lower bonuses than the previous year or even uncertainty about whether bonuses will be paid at all. LG Electronics saw a slight decrease in operating profit last year, so its bonuses may also decrease. LG Electronics paid performance bonuses up to 500% of the base salary in some divisions such as TV and domestic sales last year.

LG Household & Health Care is also reported to have not yet concluded negotiations due to reasons including the novel coronavirus infection (Wuhan pneumonia). LG Display’s chances of paying bonuses are low as well. LG Display recorded an operating loss of KRW 1.3594 trillion last year, the worst ever, due to a drop in LCD panel prices.

LG Chem, whose performance worsened due to various adverse factors such as energy storage system (ESS) fires, recently agreed with the labor union to pay 100% performance bonuses to the petrochemical headquarters and encouragement bonuses of KRW 500,000 to the battery and advanced materials business headquarters.