Who gets the AI surplus?

I recently wrote about the role employee share plans can play in creating wealth, rather than simply delivering remuneration. You can read it here. 

South Korea provides a useful follow-on because the question there is no longer theoretical. AI is already creating extraordinary pools of corporate wealth and some Korean employees are getting a direct share of it.

SK Hynix agreed to allocate 10% of its annual operating profit to employees. Reuters has calculated that, based on 2026 profits, that could translate into an average payout of around 779 million won - more than £400,000 - per employee. Samsung has also agreed to allocate around 10.5% of operating profit from its semiconductor business to special bonuses, with much of that value expected to be delivered in shares and linked to future profitability.

These are extreme numbers produced by an extreme boom.

But the more interesting feature, for me at least, is the reward architecture.

A claim on surplus

This is not simply a company deciding that employees deserve a bigger bonus. A defined proportion of profit is being allocated to employees. That changes the bargain enormously, even though the payment itself remains remuneration rather than ownership.

Salary pays for labour, for effort. A conventional bonus usually rewards the achievement of specified objectives. Profit sharing does something different: it gives employees a direct claim on part of the economic surplus generated by the business.

AI makes that distinction increasingly important.

Demand for the advanced memory needed for AI infrastructure has driven exceptional profitability at Samsung and SK Hynix. If AI allows businesses elsewhere to generate materially more output, productivity and profit from the same amount of human labour, the same question will increasingly arise.

There is no inevitable rule that all of that incremental value must flow to capital. Reward architecture can determine whether employees participate in it too.

Profit sharing never actually went away

There is an interesting UK point here.

Profit sharing can sound rather old-fashioned. UK reward architecture has increasingly organised itself around salary, annual bonuses and, for senior employees, long-term equity. But profit sharing remains entirely possible.

A UK company can decide that a defined proportion of profits should be distributed among employees. A cash profit-sharing payment will ordinarily simply be treated as employment income and operated through payroll.

There are even remnants of tax-advantaged profit participation within our tax system. Companies controlled by qualifying employee ownership trusts (EOTs) can, subject to the statutory conditions, pay qualifying bonuses of up to £3,600 a year free of income tax, although NIC still applies.

So perhaps the interesting observation is not that profit sharing disappeared. It is that we largely stopped designing remuneration around it.

That may deserve reconsideration if technology starts producing unusually large productivity gains and corporate surpluses.

Profit sharing need not replace bonus or equity. It answers a different question: how much of the success of the enterprise should flow directly to the people working in it?

From income to wealth

There is still an important distinction. A £400,000 profit-sharing bonus is income. It does not make the employee an owner. But substantial income can create personal capital. Employee equity goes further still. 

That suggests a useful progression: pay people for their work; give them a share of the profits their work helps create; then give them a stake in the capital value the enterprise itself builds. 

Korea is already beginning to blur those boundaries. At Samsung, much of the special bonus value is expected to be delivered in shares. At SK Hynix, the current dispute over its bonus arrangements includes disagreement over proposals to deliver a substantial proportion of future bonuses in restricted shares rather than cash. 

And, despite some bumps in the road, I think that progression matters.

Profit sharing gives employees a claim on part of the surplus generated today. Employee ownership gives them a stake in the capital value created tomorrow.

Much of the debate about AI and employment has concentrated on protecting labour income. South Korea suggests that the next question is how employees participate in the wealth AI helps create.

Some of that wealth is already being created. Reward design now has to decide who gets a claim on the surplus and whether that claim ends with income or extends to ownership.

At Burges Salmon, we advise companies on the full spectrum of incentive and reward structures, including employee share plans, executive remuneration, profit-sharing arrangements, employee ownership and private equity management incentives.