SK Hynix Reaches Tentative Wage Deal Using Stock Bonuses

SK Hynix reached a tentative wage and profit-sharing agreement with its South Korean workers on August 20, 2026. The deal marks a significant shift from previous all-cash payouts, stipulating that 60% of performance bonuses will be paid in company stock. Specifically, employees will receive 40% in cash and 40% in stock that can be cashed out immediately, with the final 20% paid as deferred stock compensation over two years.

The agreement includes a 6.3% increase in base wages and a provision allowing the company to defer up to 3% of wages if it records losses to protect jobs. Driven by an AI-led earnings surge, average bonuses are estimated between 700 million and 779 million won. The deal follows a period of tension where a newly unified labor union, established on August 13, pushed for entirely cash-based bonuses and urged SK Group Chairman Chey Tae-won to intervene.

While the agreement averts an immediate general strike, it remains subject to final approval via union member votes. Parallel to the labor negotiations, SK Hynix announced a 40 trillion won plan to buy back and cancel treasury shares, pledging to allocate over 50% of free cash flow from 2025 to 2027 toward shareholder returns.