![SK hynix headquarters in Icheon, Gyeonggi Province. [Yonhap]](https://wimg.heraldcorp.com/news/cms/2026/08/25/rcv.YNA.20260729.PYH2026072914490006100_P1.jpg)
Concerns are mounting in the industry as the dispute between SK hynix and its union over a treasury-share bonus plan has fallen into uncertainty once again.
After two months of negotiations, the two sides had reached a tentative agreement on wages and collective bargaining terms, but failed to secure majority approval from union members, sending talks back to square one.
Tentative agreements were also rejected by union votes in 2023 and 2024, requiring additional rounds of negotiation each time. With deep divisions remaining over both the existing agreement and a new bonus structure, the latest renegotiation could drag on before a final deal is reached.
Employee opposition to receiving bonuses in the form of company shares remains strong, leaving the company in a difficult position. Management had gone to considerable lengths to resolve the dispute — including a commitment to compensate workers in cash for any losses incurred when selling the shares — but the effort was not enough.
Some observers argue that the decision-making structure itself needs to be revisited. A tentative agreement reached by authorized representatives after lengthy negotiations can be overturned by a membership vote, generating costs and inefficiencies in the process.
According to industry sources Tuesday, the tentative agreement was voided after 50.08 percent of union members — 7,535 people — voted against it.
Under the rejected deal, SK hynix had proposed a 6.3 percent wage increase along with a profit-sharing bonus structure under which 40 percent of the excess profit distribution, known as PS, would be paid in cash and the remaining 60 percent in treasury shares.
The proposal fell just short of the majority threshold needed for ratification, forcing both sides back to the negotiating table.
Within the union, the failed vote is widely attributed to lingering resentment over the company walking back — within a year — an earlier commitment to pay bonuses entirely in cash.
Last year, SK hynix and its union agreed to set aside 10 percent of annual operating profit as a bonus pool, with 80 percent to be paid in cash in the year it was earned and the remaining 20 percent deferred over two years.
Switching to a partial treasury-share payout just one year later, with restrictions on when those shares could be sold, triggered a backlash. Workers' main objection was that unlike cash, the actual value of treasury shares fluctuates with the share price.
A shareholder meeting became an additional complication. Because the new structure shifts more than half of the bonus into shares — a change from the previous all-cash arrangement — the amended Commercial Act requires the matter to go before a general shareholders' meeting. That requirement unsettled some employees, who worried that shareholders could vote down the bonus agenda on the grounds that the payout was excessive, disrupting share-based bonus payments.
The union has said, however, that bonuses would be paid in cash if the shareholders' meeting rejects the proposal. The company is understood to have said it would do its best to secure approval.
The proportion of bonuses paid in treasury shares is expected to be the central sticking point in the upcoming renegotiation. Management maintains that some degree of share-based payment is unavoidable to cushion the impact of large cash outflows from bonus payments.
Having already offered to set the treasury-share portion at 60 percent in the first proposal — a concession management considers significant — the company is expected to resist further reductions, making the renegotiation more contentious. Raising the cash portion above the 40 percent already offered would increase the cash outflow burden beyond what was envisioned in the first deal.
SK hynix is planning large-scale facility investment at major production sites in South Korea and abroad to ease a supply crunch in AI memory chips, and is focused on securing the necessary funding in advance.
The company has committed 600 trillion won to building a semiconductor cluster in Yongin, Gyeonggi Province, and has announced plans to invest about 100 trillion won to expand NAND flash production capacity in Cheongju, North Chungcheong Province, and about 400 trillion won to develop a new semiconductor cluster in the Honam region.
Meanwhile, the near-even split — 49.92 percent in favor versus 50.08 percent against — has highlighted a sharp divide within the union itself.
With membership opinion so evenly divided on the first tentative agreement, analysts expect the union to face significant difficulty building internal consensus during the renegotiation process.
joze@heraldcorp.com
go@heraldcorp.com
