After Samsung, it's SK Hynix's employees' turn to be upset: the 500 million won mortgage limit makes them "want to switch jobs", and Kia and Hyundai can't sit still either.

The chain effect triggered by Samsung Electronics' huge salary agreement is continuing to spread in South Korea.

Benchmarking Salaries Against Each Other

According to a report by South Korea's Chosun Ilbo on the 1st, the vicious cycle of the "salary game" between Samsung Electronics and SK Hynix goes on and on. Employees have expressed their dissatisfaction, asking, "Why are our benefits worse than those of our competitors?" Companies have no choice but to benchmark their salaries. They adjust their salary systems to match those of their competitors and even offer additional bonuses to prevent talent drain and appease employees' discontent.

Recently, a person related to South Korea's semiconductor industry revealed that there has been a large number of calls within SK Hynix to "raise the current ceiling of housing loans from 100 million won (about 446,000 yuan) to 500 million won (about 2.23 million yuan)". These calls for salary benchmarking emerged after the labor - management agreement was reached by Samsung Electronics last month. According to the agreement at that time, Samsung Electronics will not only pay huge performance bonuses but also raise the ceiling of housing loans to 500 million won.

SK Hynix plans to launch a new round of salary and collective bargaining as early as early June. Just as the Samsung Electronics union successfully demanded "treatment on par with SK Hynix" by threatening a strike, the SK Hynix union is very likely to use the same tactic in the upcoming negotiations, putting forward the demand that "we also require the same treatment as Samsung Electronics".

Mr. Kim, who is engaged in real - estate agency business in Bundang, Gyeonggi - do, South Korea, said, "Recently, the number of SK Hynix and Samsung Electronics employees coming to consult about viewing properties has increased significantly. Among SK Hynix employees, I've met several dissatisfied customers who complained, 'My friend working at Samsung can get a 500 - million - won housing loan, while we're limited to 100 million won.'"

A couple working at SK Hynix also expressed their views: "We need this performance bonus as a down payment for an apartment. However, when considering the company's loan benefits, we think the conditions offered by Samsung Electronics are more favorable, and one of us even has the idea of switching to Samsung Electronics."

An industry insider commented, "Currently, there is a vicious cycle in the semiconductor industry. Even if the absolute value of employees' salaries is quite considerable, dissatisfaction will arise as soon as they compare with their competitors."

Semiconductor industry experts emphasized that "the key problem is that the salary standards established during the prosperous period may become a heavy financial burden once the economy enters a downturn." In addition, unlike their American counterparts, South Korean companies face great legal and social resistance when implementing large - scale layoffs, making large - scale layoffs almost an impossible task in South Korea.

The aforementioned industry insider added: "In the semiconductor industry, which highly depends on continuous investment in the future, competing to offer excessively high salaries is like a 'self - weakening' behavior. In the long run, it will only erode the company's own competitiveness."

Full - scale Spread

As trade unions of major companies are increasingly demanding that "N% of operating profit" be used as the basis for calculating performance bonuses, the conflict between labor and management is intensifying. Business people are worried that this "salary benchmarking" trend will continue.

According to a report by Yonhap News Agency on the 1st, so far, this demand has spread from South Korea's semiconductor industry to multiple industries such as shipbuilding, automotive, biotechnology, information technology, and telecommunications.

In addition to Samsung Electronics and SK Hynix, the union of HD Hyundai Heavy Industries has clearly demanded to share 30% of the operating profit in this year's collective bargaining proposal due to the surge in shipbuilding orders.

The unions of Hyundai Motor and Kia have also put forward the demand this year, advocating that 30% of the net profit be used as the basis for setting the performance bonus standard.

The Samsung Biologics union has demanded that 20% of the operating profit be allocated to the bonus fund and the current bonus ceiling system be abolished. For this reason, the union held its first full - scale strike from May 1st to 5th.

The union of LG Uplus (South Korea's third - largest telecommunications operator) is also actively advocating this year to set the performance bonus level at around 30%.

The union of Kakao (whose core product is KakaoTalk, equivalent to South Korea's WeChat) announced its first strike plan since the company's establishment, demanding performance bonuses equivalent to 13% - 14% of the operating profit. According to South Korea's Chosun Ilbo, Kakao paid performance bonuses to all employees in February last year, but more than half of the employees received bonuses less than half of their monthly salaries.

"Change in the Concept of the Labor Market"

In response to the "new normal" formed in South Korean union negotiations, South Korea's business community has also formulated and released a series of response suggestions.

According to South Korean media reports, on May 31st, the Korea Employers Federation (KEF) released a document titled "Special Suggestions from the Business Community on Unions' Demands for Allocating Corporate Profits". The document states that "according to the Trade Union Act, the mandatory scope of collective bargaining is strictly limited to 'working conditions', specifically including matters such as wages, working hours, welfare benefits, and dismissal policies."

The KEF emphasized that "the unions' demand for the pre - distribution of profits will lead to the infringement of shareholders' rights. The decision on how to use the operating profit should not be determined through negotiations with the unions but should be left to the discretion of the management."

In addition, the KEF suggested: "Companies have no legal obligation to conduct mandatory negotiations on the unions' profit - sharing demands." "If unions take industrial actions such as strikes mainly for the purpose of profit sharing, from the perspective of their intention, this may be regarded as 'illegal industrial action'."

The South Korean labor community refuted the above arguments of the KEF, insisting that performance - based bonuses can indeed be a legitimate topic for collective bargaining.

In a comment released on the same day, the Federation of Korean Trade Unions (FKTU) said, "The Trade Union and Labor Relations Adjustment Act does not limit the scope of collective bargaining to the formal concept of 'wages'. Any matter that affects the economic and social status of workers and their working conditions can be a negotiation topic."

The FKTU believes that "whether the unions' demands are called 'performance bonuses' or 'profit sharing', in essence, they are discussions on how to formulate standards to share the performance results created by the company with workers." The federation also strongly protested: "The KEF must withdraw its inappropriate suggestions."

It is worth noting that some observers pointed out that since the implementation of South Korea's "Yellow Envelope Act" (an amendment to the Trade Union Act) in March 2026, the conflicts over performance bonuses linked to a specific percentage of operating profit have become more intense. However, the South Korean government is trying to deny this interpretation.

The South Korean Ministry of Employment and Labor said, "The recent disputes over performance bonuses within large companies do not involve the negotiation topics between general contractors and subcontractors, which are mainly addressed by the 'Yellow Envelope Act'. Instead, they fall into the category of negotiations between employers and the workers they directly hire, and these disputes have existed long before the enactment of the 'Yellow Envelope Act'."

In response to the recent surge in performance - bonus demands, the ministry attributes it to "a change in the concept of the labor market, that is, people are starting to attach more importance to the performance improvement and profit sharing of individual companies."

The views in this article are for reference only and do not constitute investment advice. Investment involves risks, and you should be cautious when entering the market.

This article is from the WeChat official account "China - Singapore Jingwei" (ID: jwview). Author: Dong Wenbo, Editor: Li Xiaoxuan, Responsible Editors: Wei Wei and Li Zhongyuan. It is published by 36Kr with authorization.