![Samsung Electronics’ union coalition holds a rally April 23 outside the company’s Pyeongtaek campus in Gyeonggi province, calling for the removal of caps on performance bonuses. [Photo=Samsung Electronics]](https://image.ajunews.com/content/image/2026/04/26/20260426131515986762.jpg)
Major South Korean conglomerate unions are escalating demands for performance bonuses, prompting growing concern inside and outside industry.
After SK Hynix reached a deal tying bonuses to operating profit, unions at Samsung Electronics and Hyundai Motor have followed with tougher demands. Industry officials describe it as a competitive one-upmanship in bonus negotiations.
According to industry officials on April 26, Samsung’s union is demanding that 15% of operating profit be set aside for performance bonuses and that the company abolish caps on payouts. The union has also raised the possibility of a general strike.
SK Hynix previously agreed to scrap a cap of 1,000% of base pay and to pay bonuses equal to 10% of operating profit. Based on projected operating profit this year, some analysts say that could allow bonuses of about 700 million won per employee.
Hyundai Motor’s union also included in this year’s wage talks a demand for performance bonuses worth about 30% of last year’s net profit. Critics say bonus demands are increasingly driven less by productivity or individual performance than by comparisons with payouts at other companies.
Some in the business community say SK Hynix’s unusually generous agreement spurred Samsung’s union, and that Samsung’s case is now pushing Hyundai Motor’s demands higher.
In the semiconductor sector, many executives and analysts argue that much of the recent earnings strength reflects improved market conditions rather than gains in individual productivity.
“Recent improvements in memory-chip results were driven decisively by rising server demand from expanded AI investment and higher prices for commodity DRAM,” one industry expert said. “Many assessments say the DRAM price increase stems from global supply-demand conditions and market shifts, making it hard to link directly to individual employees’ efforts.”
Some analysts also say competitiveness in high-bandwidth memory, or HBM, reflects the combined impact of a small group of key researchers, long-term investment decisions and management judgment. Industry sources say there is discomfort with a 분위기 in which even junior employees with limited tenure demand bonuses worth hundreds of millions of won as a matter of course during an upcycle.
“One semiconductor industry official said the current mood looks less like profit-sharing than a scramble for bonuses riding a market boom,” adding that “a pattern could repeat in which workers take as much as possible when times are good and then blame underinvestment when conditions turn.”
Lee Gyu-bok, a former president of the Semiconductor Engineering Society, said the AI chip era will require far more capital and warned that missing development windows could cost customers to rivals. If too much money is diverted away from investment, he said, research and development schedules could slip.
Some analysts say prolonged internal conflict at Samsung is being watched by Taiwanese competitors as an opportunity. Taiwanese media and industry have suggested that if production disruptions at Samsung materialize, local companies such as TSMC could gain market share and strengthen pricing leverage.
Concerns are sharper in autos. Despite weaker first-quarter results as uncertainty grows from U.S. tariff burdens and a slowdown in the global electric-vehicle market, Hyundai Motor’s union is seeking what the industry describes as record-high bonuses. Some warn the stance could spread across corporate Korea alongside debate over the so-called Yellow Envelope Act.
“A performance bonus itself isn’t the problem,” an industry official said. “The problem is a structure where demands surge competitively whenever the business cycle improves. If this trend hardens, weaker investment capacity and supply-chain instability could ultimately shake overall industrial competitiveness.”
* This article has been translated by AI.
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