SK Hynix and delegates from one of the South Korean unions representing workers at the company held their fifth round of bonus negotiations at the chipmaker’s factory complex in Cheongju city on Tuesday.
The talks center on a profit-linked bonus arrangement that SK Hynix agreed to last year, under which 10% of annual operating profit is to be shared with employees. According to Reuters calculations cited by the parties, that framework could equate to an average payout of 779 million won per worker in 2026, which converts to roughly $547,127 using the exchange rate reported in the materials.
Management has tabled a proposal to deliver more than half of the bonus amounts in company shares, and to impose a holding period that would restrict when recipients can sell those shares, the union said in a note to members that was reviewed by reporters. The company also seeks the ability to adjust bonus payments in scenarios where it records losses, the note said.
The union pushed back against any structure that shifts market risk onto employees, saying it "would absolutely not accept any arrangement in which union members bear the risk of stock-price fluctuations." It added that if SK Hynix does not bring a "concrete and forward-looking revised proposal" to Tuesday’s session, it would be difficult to resolve the dispute solely through dialogue and the union would "take necessary action."
An SK Hynix spokesperson declined to comment on the negotiations. The union could not immediately be reached for additional comment.
The company’s shares have experienced significant price movements this year: they have risen by more than 130% year-to-date, but have also given up nearly half of their value since reaching record highs in June. The reporting materials included the exchange rate used in the calculations: $1 = 1,423.8000 won.
Context and implications
- Negotiations are focused on the structure and delivery of a bonus pool tied to operating profit, particularly the proportion paid in cash versus shares and safeguards against equity risk for employees.
- Union resistance centers on avoiding direct exposure of workers to stock-price volatility if a substantial portion of pay is made in company shares.
- Market volatility in SK Hynix’s share price is a visible backdrop to the dispute, with large gains year-to-date and a marked decline from recent highs.