SK Hynix Revised Wage and Collective Agreement Passed... 50% Cash, 50% Stock for Performance Bonuses

The revised wage and collective agreement proposed by SK Hynix management and labor following the rejection of the previous tentative agreement has been approved in a union member vote.

With this approval, management and labor are set to effectively wrap up their wage and collective bargaining negotiations ahead of the Chuseok holiday.

According to the industry on the 16th, the production-role union of SK Hynix announced that in the general vote of union members on the "2026 Wage and Collective Agreement Re-agreement Ratification Motion," which took place from 6:00 a.m. the previous day until 9:00 a.m. today, 57.08% (8,731 voters) voted in favor, resulting in final approval.

The rejection rate was 42.92% (6,566 voters).

The voter turnout reached 95.37%, with 15,297 out of 16,039 total union members from the production-role unions in Icheon and Cheongju participating.

Accordingly, SK Hynix management and labor have reached a settlement on the wage and collective agreement about three weeks after the initial tentative agreement was voted down by a mere 25 votes last month.

The approval rating, which stood at 49.92% (7,510 voters) during the initial tentative agreement vote, rose by about 7 percentage points in this vote.

The number of affirmative votes also increased by 1,221.

Prior to the revoting, opposition sentiment within the union was considerable, marked by campaigns urging rejection centered around anonymous bulletin boards and other online spaces.

However, the expanded proportion of cash payments in the revised proposal, the addition of deferred payment conditions, and concerns over prolonged negotiations appear to have swayed the sentiment of some union members toward approval.

At the core of the revised proposal are adjustments to the stock selection ratio and an expanded range of options for employees.

The cash payment portion of the Profit-Sharing (PS) bonus, which was the biggest point of contention, was raised from 40% to 50%, while the stock payment portion was lowered from 60% to 50%.

Specifically, of the total PS, 80% to be paid in the current year will be split into 50% cash and 30% stock, while the remaining 20% will be paid out as deferred stock, 10% each after one year and two years.

In particular, employees are now allowed to choose their stock allocation from a baseline of 50% up to a maximum of 100% in increments of 10 percentage points if they wish.

The 20% deferred portion of the PS calculated based on last year's performance, which was originally scheduled to be paid out over the next two years, will also be paid upfront all at once this year.

The company will bear any additional costs incurred from stock price increases during the stock distribution process.

In addition, the agreement formalizes a provision allowing the company to defer a portion of wages in the event of a deficit.

Previously, management and labor reached a first tentative agreement on August 20 calling for a 6.3% wage increase and the payment of PS bonuses with 40% in cash and 60% in company stock.

However, it was voted down on August 25 by production-role union members with 50.08% (7,535 voters) voting against it.

At the time, considerable discontent reportedly spread among employees over the sharp increase in the proportion of stock compared to the traditional cash-centered performance bonus system.

In response, management and labor readjusted the performance bonus payout terms through re-negotiations by increasing the cash proportion and advancing the previously deferred payouts.

SK Hynix stated, "We thank the labor union and our employees for standing together through a difficult process," adding, "We will continue to tackle any future challenges together by putting our heads together between the company and employees."

SK Hynix plans to hold a signing ceremony for the final agreement ahead of the Chuseok holiday to officially conclude this year's wage and collective bargaining procedures.

(Photo: Yonhap News)
※ Please note: This article was translated by AI and may contain errors.