The Korean tech giant has decided to cut the incentive rate for the mobile business employees from 50 per cent to 17 per cent, according to news reports.
Employees at Samsung Electronics' mobile business unit will take the brunt of the consequences of the Galaxy Note 7 fiasco as their annual incentives are likely to plunge due to decreased profits of the smartphone business this year.
Samsung runs the so-called OPI reward programme that pays up to 50 per cent of the annual salaries of employees within the range of 20 per cent of the firm's excess profits.
The Korean tech giant, scheduled to hand out the OPI incentives to its employees on January 26, has decided to cut the incentive rate for the mobile business employees from 50 per cent to 17 per cent, according to news reports on December 20.
The cut is mainly due to the Note 7 recall which Samsung said would cost it more than 3 trillion won (S$3.6 billion) in the last quarter of this year and the first three months next year.
For the past six years, employees of the mobile business unit have been receiving incentives at the maximum rate of 50 per cent - the highest among Samsung units - thanks to robust smartphone sales.
Workers at Samsung's memory business unit, on the other hand, are expected to receive 50 per cent of their salaries as bonus while the incentive rates for consumer electronics and display business units have been set at 7 per cent and 48 per cent, respectively.
Samsung also runs the so-called target achievement incentive, or TAI programme, which provides employees up to 100 per cent of their monthly salaries during the first and second half of every year.
Those working for the consumer electronics and chip business division are to receive the TAI bonus at a 50 per cent rate while employees at the mobile business unit will receive 12.5 per cent of their monthly wages.
The tech firm will offer the TAI bonuses to its employees on December 23.