South Korea’s SK Hynix union members reject wage agreement in vote

SEOUL - South Korean chipmaker SK Hynix’s union members narrowly rejected a tentative wage agreement on Aug 25, according to a source familiar with the matter.A total of 50.08 per cent of the 15,045 workers who cast ballots voted against the agreement, the source said. The difference was just 25 votes, the source added.SK Hynix was not immediately available for comment when contacted by Reuters. The source spoke on condition of anonymity as they were not authorised to speak to media.The agreement, reached last week, included a 6.3 per cent wage increase and a revision to SK Hynix’s profit-sharing bonus scheme, under which 40 per cent of bonuses would be paid in cash and 60 per cent in company shares.The world’s second-largest memory chipmaker has been reaping strong profits from booming demand for high-bandwidth memory (HBM) chips used in artificial intelligence applications.Last year, the two sides agreed to set aside 10 per cent of annual operating profit to fund profit-sharing bonus payments under a system to remain in place for 10 years. Under the agreement, 80 per cent of the bonus is paid in cash in the year it is awarded, while the remaining 20 per cent is deferred over two years.However, this year, management’s proposal to pay more than half of bonuses in shares met with opposition from some workers concerned about the volatility of SK Hynix’s shares. The stock hit a record high in June on enthusiasm over the AI boom before slumping on fears that too much money is being spent with insufficient reward.In May, Samsung Electronics and its unionised workers agreed on a deal on performance pay, averting a major strike at the chipmaker that had threatened to disrupt supplies.Samsung agreed to allocate 10.5 per cent of its annual semiconductor operating profit to special bonuses for chip workers. The bonuses would be paid in company stock, with the immediate sale of a majority of the shares to be restricted.Shares of SK Hynix were trading down 4.9 per cent, compared with a 2.2 per cent decline in the benchmark KOSPI as of 0036 GMT (8:36am Singapore time). REUTERS