Seoul: SK hynix Inc. and its labor union reached a tentative wage deal on Monday that includes a 6 percent pay rise and the removal of the ceiling on profit-sharing bonuses.
According to Yonhap News Agency, after 11 rounds of negotiations over the past three months, the management and the union agreed to scrap the cap on profit-sharing bonuses, which had been limited to 1,000 percent of employees' basic pay. In addition, SK hynix will allocate 10 percent of its annual operating profit to the profit-sharing bonus program.
The pay increase, however, fell short of the union's initial demand for an 8.25 percent hike. Despite this, the tentative deal is expected to be finalized this week following approval by union members.
The agreement comes in the wake of SK hynix's record-breaking financial performance. The company's second-quarter operating profit exceeded 9 trillion won (US$6.45 billion) for the first time in its history, fueled by booming demand for artificial intelligence (AI) chips, including high bandwidth memory.