'Performance Bonus Controversy' SK Hynix, Labor-Management Agreement on Employee Stock Ownership Plan Payment and PS System Improvement (Update)

PS Calculation Indicator Changed from Existing EVA to Operating Profit Linkage
Introduction of Employee Stock Ownership Equivalent to 200% of Base Salary Subject to Board Approval
Corporate Welfare Points of 3 Million Also Granted

SK Hynix Headquarters in Icheon, Gyeonggi-do
[Image source=Yonhap News]

[Asia Economy Reporter Kim Heung-soon] SK Hynix announced on the 4th that labor and management reached an agreement at the Central Labor-Management Council held at the headquarters in Icheon, Gyeonggi Province, to improve the Profit Sharing (PS) system and provide employee stock ownership to its members.

The management first decided to change the PS calculation standard from the existing EVA (Economic Value Added) to be linked with operating profit and plans to communicate with employees next week. SK Hynix explained, "There had been dissatisfaction among employees due to the EVA indicator," adding, "We aimed to increase predictability by using operating profit, whose figures are clearly disclosed."

Additionally, management agreed, subject to board approval, to issue employee stock ownership and grant employees the right to purchase shares. Although specific details will be decided later, they plan to provide benefits roughly equivalent to 200% of the base salary. The company added that granting employee stock ownership is intended to jointly promote the company's future growth with its members.

Furthermore, 3 million Hi-Well Points, an in-house welfare point system, will be given to all employees. The union responded positively to these three proposals from management, leading to the agreement. SK Hynix expects that the recent controversy over performance bonuses will be settled following this labor-management agreement.

Lee Seok-hee, CEO of SK Hynix, said, "I sincerely apologize for not communicating sufficiently until now," and added, "Above all, trust between employees and the company is most important, so going forward, the direction of management will focus on 'fairness' and 'transparency.'"

Kim Hae-joo, chairman of the SK Hynix Icheon Labor Union, evaluated the agreement as "opening a new path for mutual development between the company and its members." Kang Guk-mo, chairman of the Cheongju Labor Union, added, "We will heal wounds and move forward together toward the future."

This content was produced with the assistance of AI translation services.