SK Hynix workers to get 60% of this year's bonuses in stock rather than cash

SK Hynix workers to get 60% of this year's bonuses in stock rather than cash

SK Hynix workers to get 60% of this year's bonuses in stock rather than cash

FILE PHOTO: The SK Hynix logo is seen on one of its products during The 2024 Semiconductor Exhibition in Seoul

Updated Thu, August 20, 2026 at 11:40 AM GMT+3 2 min read

• SKHY +0.92%

By Hyunjoo Jin

SEOUL, Aug 20 (Reuters) - Chipmaker SK Hynix (SKHY) said on Thursday it has reached a tentative wage deal with its South Korean workers that will see ‌them receive at least 60% of this year's bonuses in company stock rather than ‌the all-cash payout they received last year.

SK Hynix stock rose 4% before the bell on Thursday following the news.

The AI boom has sent SK Hynix's earnings soaring, leading to eye-popping bonuses for ​its employees. Workers are set to be paid an average 779 million won ($547,000) for 2026, according to Reuters calculations.

"It is a win-win solution. An all-cash payment would have placed both SK Hynix and its workers in a difficult position," said Kim Yong-jin, a management professor at Sogang University.

"It would drain ‌the company's cash reserves and ⁠could have triggered a public backlash over what may be seen as lavish payouts," he said.

The agreement is subject to a vote by union members, ⁠an SK Hynix spokesperson said.

Last year, SK Hynix agreed to share 10% of its annual operating profit with workers in cash under an agreement that would remain in place for 10 years.

This year, however, 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 excitement over the AI boom before slumping on fears that too much money is being spent with insufficient reward.

Under this year's agreement, employees will receive 40% of their bonuses in cash and 40% in stock. That stock portion can be cashed out immediately. The remaining 20% will ‌be paid in stock as deferred compensation: half after ​one year and the rest after two years.

The deal also ​includes a 6.3% increase in base ​wages and a clause allowing the company to defer up to 3% of ‌wages should SK Hynix record losses.

"Labor and ​management came up with ​their own breakthrough without relying on external mediation or systems," SK Hynix said in a statement.

SK Hynix said on Wednesday that it would buy back and cancel 40 trillion ​won ($28.6 billion) of treasury shares and ‌allocate more than 50% of free cash flow generated between 2025 and 2027 to ​boost shareholder returns.

(Reporting by Hyunjoo ​Jin; Editing by Ed Davies and Edwina Gibbs)