Superficial Internal Competition... KT New Union Demands "Revamp Outdated Performance Bonus System"

Bonus Frozen for Years Despite Profit Growth
Outdated Ad Hoc Bonus System Needs Reform
"Established Unions Must Reflect for Not Fighting"

[Asia Economy Reporter Cha Min-young] The trend in the IT industry demanding fair compensation for profit growth has spread to the telecommunications sector. Following SK Telecom, voices calling for a reform of the performance bonus system are spreading among young employees within KT. There is also a warning that if KT CEO Koo Hyun-mo and other executives do not listen to internal voices, the outflow of talent will continue.

The new KT labor union issued a statement on the 19th, pointing out, "While the anger of young employees over KT's unreasonable performance distribution system is rising, there is no public issue raised within the company system."

According to the new KT labor union, KT's employee performance bonuses have been frozen for several years. The average annual salary per employee decreased from 73 million KRW at the end of 2015 to 65 million KRW as of September 2020, a reduction of about 10 million KRW. The average amount includes long-term employees and executive salaries, so the salaries of employees with less than five years of experience are inevitably lower. During the same period, KT's dividends increased 2.7 times from 500 KRW in 2015 to 1,350 KRW in 2020.

They also voiced the need to reform the performance bonus system that encourages an internal zero-sum game. KT has a structure where a fixed amount of performance bonuses is allocated by organization. The current relative evaluation-based bonus system has led to internal competition and ranking culture without company-wide performance management. As an example, they cited the case of Jeong Jeong-su, head of the Gangnam West Headquarters.

The new KT labor union criticized, "There is no proper reward or management for outstanding talent, and employees, despairing over the executives’ showy and outdated corporate culture focused on internal competition, are leaving the company at every opportunity." A sense of crisis has grown that the company might collapse after losing all its personnel to competitors.

They also raised issues regarding the established first labor union. The new union said, "A more serious problem is that KT’s first labor union remains completely silent about this flawed performance distribution," and noted that on the anonymous workplace community app Blind’s KT Lounge, a hashtag campaign #JangBokAhIlHaeRa (meaning "JangBokAh should resign") has even been launched.

The new union emphasized, "For KT to transform into a platform company and gain competitiveness, this unreasonable performance bonus system must be changed," adding, "If CEO Koo Hyun-mo and other executives do not immediately take steps to improve the bonus system, the motivation of KT employees will inevitably decline further."

This content was produced with the assistance of AI translation services.