"What's the Basis for Calculation?" Performance Bonus Controversy Spreads in Business Circles, SKT Also Settles After Hynix

SKT Improves Payment Criteria... "Will Strengthen Trust Through Dialogue and Communication"

[Asia Economy Reporter Joselgina] SK Telecom, which has recently faced widespread controversy over performance bonuses, appears to have resolved the related conflict by deciding to improve the payment criteria through labor-management agreement starting next year. The performance bonus issue, which was triggered by SK Hynix, spread not only to SK Telecom, an affiliate, but also to other large corporations such as Samsung Electronics and LG Energy Solution, which was spun off from LG Chem, causing tension across the entire industry.

According to the industry on the 9th, SK Telecom's labor and management agreed this morning to operate a joint labor-management task force (TF) from the 15th of this month to improve the performance bonus system. The main point is to change the performance bonus criteria from the current EVA (Economic Value Added) to alternative indicators such as operating profit. Regarding the fact that the majority of members do not receive the average amount, they decided to expand the proportion of members who receive amounts above the standard. A detailed agreement on the indicators and payment methods will be reached within the first half of the year. The improvement plan aims to be applied to performance bonuses paid next year.

Earlier, the SK Telecom labor union sent a letter to CEO Park Jung-ho in the name of the chairman, pointing out that "we cannot help but have serious concerns about the performance bonuses, which are expected to decrease significantly compared to last year." They also demanded the disclosure of the correlation between performance and bonuses to ensure predictability and objectivity, and called for a complete overhaul of the performance bonus system. In response, CEO Park said, "We will continue to expand communication with members," and through behind-the-scenes agreements, the performance bonus controversy seems to be coming to an end.

SK Telecom stated, "The labor union welcomed the company's active acceptance of members' opinions who desire a transparent performance bonus system," and added, "Labor and management have agreed to further strengthen harmony and trust through sincere dialogue and communication."

The conflict at SK Hynix, which triggered the recent performance bonus controversy, has also been resolved for the time being. Notably, before the labor-management council meeting, SK Group Chairman Chey Tae-won expressed his intention to forgo his salary, and SK Hynix CEO Lee Seok-hee apologized, saying, "I am sorry for not meeting expectations," marking an unusual intervention by both the group head and CEO to calm the situation.

On the 4th, SK Hynix held a labor-management council meeting and decided to provide employees with company stock and welfare points, and to change the profit-sharing (PS) calculation standard from EVA to operating profit. Additionally, subject to board approval, company stock will be issued so that benefits equivalent to 200% of the base salary will be returned to members.

The business community views the recent spread of the performance bonus controversy as reflecting the characteristics of the MZ generation, which values fairness and transparency. The MZ generation, who collectively express their opinions through internal bulletin boards and social networking services (SNS), are regarded as employees who "speak their minds." It is noteworthy that they emphasize transparent disclosure of calculation criteria rather than simply demanding "more."

Lee Jang-joo, a socio-cultural psychologist at the Irak Digital Culture Research Institute, pointed out, "The concept of a 'lifetime job' has disappeared, and since various comparisons with competitors and overseas cases are possible, it is necessary to establish clear standards that members can accept."

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