SK hynix Labor and Management Reach Revised Tentative Agreement on Performance Bonuses... Cash Ratio Raised to 50% (Comprehensive)

General Vote for All Union Members on September 15-16
Advance Payment of Deferred Performance Bonuses, Expanded Welfare Benefits
Additional Housing Loan Support for Single-Parent Households Included

SK hynix's labor and management have reached a revised provisional agreement that increases the cash proportion in the performance bonus payment system and greatly expands the individual choice of employees, thereby accelerating efforts to resolve the ongoing conflict between the two parties.

On September 10, SK hynix announced that labor and management had prepared a revised wage and collective bargaining agreement, under which the default performance bonus payout ratio would be adjusted from the previous 40% in cash and 60% in company shares to an even 50% in cash and 50% in shares.

Yonhap News Agency

Previously, labor and management had drafted a provisional agreement to raise wages by 6.3%, with 40% of the excess profit sharing (PS) paid in cash and the remaining 60% in company shares. However, this initial agreement was rejected by a margin of 25 votes in a union ballot held on August 25. Some analysts attribute this outcome to the change in how bonuses are distributed—shifting from last year’s agreement to pay bonuses fully in cash to including company stock just one year later—which triggered backlash from employees.

While maintaining the overall framework of the previous provisional agreement, the revised version aims to better reflect the voices from the field, especially by expanding the practical benefits and options available to each individual. Labor and management at SK hynix increased the proportion of the performance bonus paid in cash by 10 percentage points compared to the initial proposal to meet demand from employees seeking more immediate cash liquidity. In addition, a new system was introduced that lets employees individually choose the proportion of their bonus received in shares—from a minimum of 50% up to a maximum of 100% in 10% increments—thereby greatly enhancing personal asset management and freedom of choice.

Measures have also been drawn up to minimize confusion and uncertainty at the workplace that could arise from changes to the bonus payment structure. In a significant move to increase the tangible sense of reward for employees, a decision was made to prepay bonuses that had originally been scheduled for deferred payment next year and the following year, based on last year’s performance.

The company is also promoting policy reforms to support work-life balance and close gaps in the workplace welfare system. Previously, additional housing loan support, beyond the standard benefits, was exclusively available to 'married households.' This agreement, however, formally expands eligibility to include 'single-parent households.' As a result, the institutional foundation has been strengthened so employees with diverse family structures can enjoy practical housing stability and welfare benefits.

The revised agreement will be put to a final approval vote of all union members over two days, from September 15 to 16, after being discussed at the union’s extraordinary delegate assembly on the same day. If the proposal passes, it will mark the conclusion of the wage and collective bargaining negotiations between SK hynix labor and management that resumed after last month’s rejection of the initial provisional agreement.

Previously, Gwark Nohjung, CEO of SK hynix, commented during an internal communication event held on September 2 that, in relation to performance bonuses, "Last year, we were able to reach an agreement on the broad points, and we will closely consider the details alongside our employees," adding, "We will strive so that both the company and its members can grow with pride together."

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