Seoul [South Korea], August 10 (ANI): Employees at South Korean memory chipmaker SK Hynix are forming a companywide labor union spanning both production and office workers, escalating a conflict over management's push to alter a profit-sharing deal reached last year, according to a news report by Korea Herald.

Citing industry sources, the report stated that around 3,800 workers have joined an online organizing group since its launch on August 5. The enrollment represents 11 per cent of the total 34,466 workforce that SK Hynix reported at the end of last year. Organizers officially submitted an application to form the unified union on Saturday.

SK Hynix currently operates with three separate unions divided by work location and job category. Its technical and office staff union falls under the Korean Confederation of Trade Unions, while production workers at the Cheongju and Icheon facilities belong to the Federation of Korean Trade Unions. The new initiative aims to combine these divided groups under a single entity to enhance overall bargaining leverage.

The dispute centers on changes to the company's profit-sharing bonus scheme. Management and labor representatives agreed last year to distribute 10 percent of annual operating profits to staff over a 10-year period, with 80 percent distributed in the profit-earning year and the remaining 20 percent paid out over the subsequent two years. During this year's wage negotiations, management suggested altering the deal by paying a portion of the bonus in restricted company stock.

Workers expressed strong opposition to the revision, pointing out that equity compensation exposes their earnings to share-price shifts and that reopening a year-old contract harms mutual trust.

'The unified union's top priority is the full implementation of the bonus agreement reached last year,' the interim union chief said in a notice.

The organizing movement gained speed due to dissatisfaction with existing union representatives, who produced minimal results across five rounds of formal pay talks. Meanwhile, regulatory uncertainty grew after Industry Minister Kim Jung-kwan publicly voiced opposition to profit-tied bonus systems, with the Labor Ministry preparing to release collective bargaining guidelines this month.

Employees are also closely monitoring labor developments at Samsung Electronics, where the primary union expanded to over 76,000 members and secured a new semiconductor performance bonus.

'The new union would still need to secure representative bargaining status through a consolidation process,' an industry official said. 'It remains unclear whether it could participate in the current wage negotiations or would have to wait until next year.'

SK Hynix noted that it has not officially verified the new entity's establishment and will adhere to statutory regulations if the union forms. (ANI)