Labor and management at SK Hynix continued a tense standoff during the fourth round of major collective bargaining this year over proposals to pay performance bonuses in stock and adjust wages in case of losses. Amid record-breaking financial performance, the union has opposed the company's new wage system reform plan, raising the possibility of industrial action, which is expected to lead to prolonged difficulties.
According to the minutes of the fourth round of major labor-management negotiations released by SK Hynix's union on the 31st, labor and management held four days of intensive practical negotiations over the past two weeks but failed to narrow their differences regarding the method of paying performance bonuses and reforming the wage system.
Management stated in the negotiations that "it is urgent to find a way to wisely navigate various social demands and gain the understanding of stakeholders," adding, "We request the labor union's understanding and determination so that it can be established as a sustainable system." In response to the union's demands regarding the pace of negotiations and revised proposals, management conveyed its position to present comprehensive proposals in the next round of negotiations.
On the other hand, the union strongly criticized management for insisting on a proposal to pay more than half of performance bonuses in stock with restrictions on selling them for a certain period, as well as a plan to temporarily adjust wages if losses occur. The union stated, "We cannot accept any proposal that undermines the spirit of last year's labor-management agreement on performance bonuses," and added, "In particular, we absolutely cannot accept a method where members bear the risk of stock price fluctuations." Furthermore, the union said, "A plan to temporarily adjust wages due to losses also does not align with the basic principles of the labor union." It further declared, "If the company maintains its existing fundamental direction of forcing sacrifices from members until the fifth round of major negotiations without presenting specific and proactive revised proposals, we judge that it will be difficult to resolve the issue through negotiations alone and will take necessary actions."
The core factor behind the intensifying labor-management conflict is the company's record-breaking financial performance. Due to a boom in AI (artificial intelligence) semiconductors, SK Hynix achieved operating profits of up to 100 trillion won in the first half of this year alone, and securities firms project that annual operating profits could reach approximately 250 trillion won. Last year, labor and management reached a 10-year agreement to use 10% of operating profits as a source for PS (excess profit distribution fund) without setting an upper limit. Based on this, when calculated across all employees (approximately 35,000 people), the estimated PS fund amounts to an average of 700 million won per person (pre-tax).
On the other hand, management is wary of the sharp fluctuations in performance typical of the semiconductor market. Given that the company recorded an annual operating loss of 7.7 trillion won during the industry downturn in 2023, it is interpreted as a move to prepare for future uncertainties by introducing a system of staggered stock payments and wages linked to losses.
Amid persistent differences over the key issues of performance bonus payment methods and measures to address losses, labor and management are scheduled to hold the fifth round of major negotiations on August 4 at the Cheongju Campus to continue discussions.
in INDUSTRY
