Union members at SK Hynix, the world's second-largest memory chipmaker, narrowly rejected a tentative wage agreement on Tuesday, with 50.08% of 15,045 voters casting ballots against the deal, according to Yonhap News Agency and a source familiar with the matter. The margin was razor-thin: 7,535 members opposed while 7,510 supported it, a difference of just 25 votes. Turnout was high, reaching 93.8% among the company's 16,083 union members, as reported by Yonhap News Agency.
The rejected proposal, which followed two months of negotiations, had offered a 6.3% increase in base wages and a significant overhaul of the company's profit-sharing scheme. Under the proposed structure, 40% of performance bonuses would be paid in cash and the remaining 60% would be issued in company shares, according to Reuters. Part of the stock would be immediately available for sale, with the rest deferred over two years.
That marked a departure from the previous arrangement, which had set aside 10% of annual operating profit for bonuses, with 80% paid immediately in cash and 20% deferred over two years. The shift toward a larger stock component reportedly drew opposition from workers concerned that their compensation would become more exposed to fluctuations in SK Hynix's share price, as reported by The Korea Times.
The disagreement comes during an exceptionally profitable period for the company. SK Hynix has been reaping strong profits from booming demand for high-bandwidth memory (HBM) chips, which are used in artificial intelligence applications, as reported by Reuters. In July, the company reported record second-quarter results, with revenue reaching 79.3 trillion won and operating profit climbing to 60.5 trillion won, according to its latest earnings release.
Those profits have also increased the size of potential employee payouts. According to the earnings release cited by International Business Times, workers are expected to receive an average performance bonus of about 779 million won ($547,000) for 2026, although actual payments vary by position and individual evaluations.
In a related development, SK Hynix's stock fell 4.9% on Tuesday morning, compared with a 2.2% decline in South Korea's benchmark KOSPI index. The company's shares had reached a record high in June before retreating, as noted by International Business Times.
The rejection highlights the sensitivity of bonus structures in South Korea's semiconductor industry, a sector that has seen rising tensions between labor and management. In a similar vein, Samsung and its union reached an agreement in May that allocated 10.5% of annual semiconductor operating profit to special bonuses, largely in company shares. That deal helped avert a planned strike involving about 48,000 workers, as reported by International Business Times.
SK Hynix's management and labor representatives are now expected to return to negotiations, with the bonus payment structure likely to remain a central issue, Yonhap News Agency reported. The outcome of those talks will be closely watched in a sector where worker compensation is increasingly tied to the volatile semiconductor market.
Perspectives: While the material does not include direct quotes from labor or management, the differing positions are discernible: management proposed a bonus structure with a higher stock component, while union members sought to limit stock exposure, preferring a larger cash portion. The company remains focused on maintaining its financial performance during a period of AI-driven demand, while workers appear to prioritize financial stability amid stock price fluctuations.