SK hynix’s labor and management successfully negotiated a wage and collective bargaining agreement (CBA) that increased the cash portion of performance bonuses. The initial proposal with a 40% cash ratio was rejected by a slim margin of 25 votes. However, the revised proposal, which raised the cash portion to 50%, passed with a substantial 2,165-vote majority. This outcome clearly indicates that employees prioritized receiving their performance bonuses in cash.
Another factor that swayed union members was the decision to accelerate the payment of surplus profit sharing (PS), which was originally slated for distribution in 1-2 years based on last year’s performance. Notably, the company’s commitment to compensate for any decline in the value of company shares received as PS, based on the closing price on the first day of sale, and to cover any resulting taxes, also played a significant role in gaining support.
Initial Proposal Rejected By 25 Votes; Increasing Cash Payment Ratio Led to 1,221 More Yes Votes
Industry sources reported on Wednesday that SK hynix’s production workers’ union voted on the 2026 CBA re-agreement over the past two days. The proposal passed with a 57.08% approval rate. The voting process required participation from a majority of all union members, with passage contingent on a majority approval from those who voted.
Of the 16,039 eligible voters, 15,297 cast ballots, resulting in a remarkable 95.37% turnout. The final tally showed 8,731 votes (57.08%) in favor and 6,566 votes (42.92%) against. The technical office workers’ union, having already approved the previous agreement, did not participate in this vote on the amended proposal.
The initial tentative agreement for the production workers’ union, voted on August 24 and 25, had failed by a razor-thin margin of 25 votes. In that election, out of 15,045 participating members, 49.92% (7,510) approved while 50.08% (7,535) opposed. The re-vote on this CBA amendment saw approval increase by 1,221 votes while opposition decreased by 969.
Expanded Cash Portion of Bonuses and Accelerated Deferred Payments Proved Effective
The cornerstone of this agreement lies in the revised PS distribution method. The wage increase rate remains unchanged at 6.3%, consistent with the initially rejected proposal.
The amended proposal, however, adjusted the basic distribution ratio of performance bonuses from 40% cash and 60% stock to an equal 50-50 split. Additionally, employees now have the flexibility to choose their stock distribution ratio, ranging from 50% to 100% in 10 percentage point increments.
Of the total PS, 80% will be distributed as 50% cash and 30% stock, with the remaining 20% deferred equally over the next two years.
The increase in the cash distribution ratio from 40% to 50% appears to have resonated strongly with union members. Furthermore, the decision to expedite the payment of performance bonuses previously scheduled for the next two years likely contributed to the shift in voting sentiment.
Importantly, the company agreed to compensate for any decline in the value of company shares received as PS, based on the closing price on the first day of sale, and to cover any resulting taxes.
The expansion of welfare benefits also garnered positive responses. The criteria for additional support, previously limited to married households, will now include single-parent families, broadening the scope of housing assistance.
The union’s efforts to conduct approximately 60 member briefings to explain the changes’ significance, purpose, and effects likely played a crucial role in securing passage of the amendment.
Additionally, fatigue among union members due to prolonged negotiations and external pressure are believed to have influenced the agreement’s approval.
SK hynix emphasized the significance of this agreement, noting that despite an initial rejection, labor and management collaboratively found a solution within the existing framework. The company plans to hold a signing ceremony for the final agreement before the Chuseok holiday, officially concluding this year’s CBA process.