SK hynix sets model for sharing benefits with subcontractors

By Yoon Sung-won

SK hynix has set a new model for coexistence between conglomerates and subcontractors, with its workers deciding to use part of its increased wages for the employees of its subcontractors.

The world’s second-largest semiconductor maker, a unit of SK Group, said its labor union and management have agreed to use 20 percent of its employees’ wage increases for 4,000 workers of its subcontractors, including an improvement of their work environment.

“The agreement is a meaningful achievement for the construction of a win-win partnership between a conglomerate and smaller partners,” said SK hynix CEO Park Sung-wook.

Park said the stronger alliance with subcontractors will ultimately help boost its competitiveness to retain leadership in the semiconductor industry.

On top of sharing wages with partner companies, the agreement includes the establishment of a wage system reformation committee and a win-win cooperation program to seek mutual growth in urban and rural areas.

It is the first time that workers of a conglomerate have shared the benefits of wage increases with partner companies amid the increasing demands for wage and welfare enhancement of laborers.

With the wage sharing plan, the company will provide up to 20 percent of its wage increase ― 10 percent from the SK hynix employees and another 10 percent from the company ― for its partner companies’ employees.

The SK hynix’ labor union and management have agreed on a 3.1 percent wage increase this year.

SK hynix employees will share 10 percent of the 3.1-percent increase, for the wage sharing, and the company pays the same amount to provide the benefits for the partner companies’ employees.

Accordingly, SK hynix employees will get only a 2.8 percent wage increase. Instead, about 4,000 employees of its partner companies at its Icheon and Cheongju plants will receive benefits including wage increases, welfare improvement and workplace renovations.

The SK hynix labor and management also agreed upon the guidelines for the extension of retirement age and the introduction of salary peak system that they have decided to introduce last year. In addition, they will jointly establish a committee to conduct a reform in wage system for blue collar employees by the latter half of this year.

Under its plan to seek mutual growth with the regional economies, the company said it will collaborate with local agricultural federations to mass purchase agricultural products for its employees.

“The agreement has proved the company’s close ties between labor and management are like those of a family,” SK hynix labor union heads Kim Jun-soo and Park Tae-seok said in a statement. “The labor union will continue cooperate for the social responsibility and pushing ahead with the wage sharing program and the wage system reform committee in the future.”