SEOUL, July 22 (AJP) - A decade-long profit-sharing pact at SK hynix has returned to the negotiating table just one year after it was signed, as unions push back against a proposed overhaul that could require employees to receive part of their bonuses in company shares.
The chipmaker’s production and office-worker unions held separate intensive bargaining sessions with management on Tuesday after the two sides failed to narrow differences over bonuses and other key issues during a third round of formal wage negotiations last week.
The company has proposed a new bonus-related plan during this year’s negotiations, according to industry sources.
Details have not been disclosed, but one option under discussion is believed to involve the mandatory payment of a portion of bonuses in SK hynix shares.
The proposal has drawn resistance from both unions, which argue that it could undermine an agreement reached last year after prolonged negotiations.
SK hynix and its unions agreed in 2025 to remove the ceiling on the company’s profit-sharing bonus, known as PS, and maintain the framework for 10 years. Under the agreement, 10 percent of annual operating profit is allocated to the bonus pool.
Employees receive 80 percent of their PS payment in cash during the relevant year, while the remaining 20 percent is deferred and paid in equal installments over the following two years.
Their peers at Samsung Electronics receive bonus mainly in company shares.
The company also operates a voluntary shareholder participation program allowing employees to receive up to half of their PS bonus in company shares. Participants who hold the shares for one year receive an additional cash payment equivalent to 15 percent of the purchase amount.
The production workers’ union said the company’s latest proposal went against the intent and basic direction of last year’s agreement. The office workers’ union separately said it would reject any change that reduced employee compensation or weakened the existing bonus formula.
Employee concern has grown as SK hynix is expected to generate another year of strong earnings on robust demand for high-bandwidth memory used in artificial intelligence accelerators. Any change in the payment structure could have a significant effect on the timing and form of employee compensation.
Industry observers said the company may be seeking to limit large cash outflows and link employee rewards more closely to its long-term share performance. Workers, however, have questioned why a framework promised for 10 years is being reconsidered after only one year.
SK hynix operates under a multiple-union system. Its technical and office workers’ union, affiliated with the Korean Confederation of Trade Unions, and its production workers’ union, affiliated with the Federation of Korean Trade Unions, conduct wage negotiations separately with management.
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