SK Telecom, a key subsidiary of South Korea’s SK Group, has introduced a voluntary retirement program offering up to 300 million won ($223,000) per employee, company officials confirmed on Sept. 26. The announcement comes as SK On, the group’s battery manufacturing arm, unveiled its first-ever voluntary retirement and unpaid leave programs, signaling a growing wave of workforce reductions within the conglomerate amid ongoing restructuring efforts.
SK Telecom notified employees on Sept. 23 about the updated “Next Career” program, which was first launched in 2019. The program previously allowed employees to take two years of paid leave and receive an additional 50 million won in severance pay upon retirement. However, due to the company’s high average annual salary of 152 million won ($113,000), participation was limited. In an effort to boost uptake, the retirement package has been increased to a maximum of 300 million won.
“While SK Telecom continues to turn a profit, its overall business has stagnated, and the company is facing growing wage costs as the number of high-earning senior employees rises,” a source familiar with the situation said. The voluntary retirement program is part of the company’s strategic shift toward focusing on artificial intelligence investments, they added.
On the same day, SK On announced plans to offer voluntary retirement to employees hired before November 2023. Retirees will receive 50% of their annual salary along with a short-term incentive. The company also introduced an unpaid leave program, providing up to two years of tuition support for personal development. Launched in 2021, SK On has invested aggressively in catching up with industry leaders despite financial losses, but the company is now moving to reduce its workforce following a slowdown in demand for electric vehicles.
“The aim is to increase management efficiency and ensure sustainable growth,” an SK On spokesperson said in a statement. “We will offer development opportunities to employees and provide full support for those choosing new career paths.”
Additionally, the SUPEX Council, an internal advisory body for SK Group, held a human resources briefing on Sept. 25, outlining new policies that include employees returning to their original positions after three years of council service and adjustments to performance bonuses based on management conditions.
“These measures are intended to help the group navigate challenging business environments and prepare for the future,” an SK Group official said.
