Kakao Reaches Final Wage Agreement, Labor-Management Conflict Moves Toward Resolution After Three Months (Comprehensive)

Agreement Reached on 6.3% Salary Increase and Special Incentive of 3 Million Won
Discussion on Including RSUs in Performance Bonuses Deferred

Kakao’s management and labor union have reached a final agreement on wage negotiations, bringing an end to nearly three months of labor-management conflict. As a result, the first-ever strike in Kakao’s history is now entering the process of resolution. Both parties agreed to revisit discussions on the performance bonus scheme after October.

On August 7, Kakao’s labor and management jointly announced that this year’s wage agreement had been finalized following a union vote.

Gyeonggi Seongnam Kakao Pangyo Agit. Photo by Jinhyung Kang aymsdream@

The Kakao branch of the KCTU Korean Federation of Chemical, Textile, and Food Workers' Unions (Kakao Union) stated, “The vote on the provisional agreement among union members has concluded,” adding, "The process will officially be completed after the signing ceremony."

The new agreement includes a 6.3% increase in the wage pool, excluding funds allocated for stage-up pay related to position and role upgrades, as well as a special incentive allotment of 3 million won.

Kakao's management and labor had been negotiating issues such as the performance-based compensation system and the wage increase rate. The union demanded a 6.9% salary increase and a performance bonus standard set at 13-14% of operating profit. In contrast, management proposed a 6.8% salary increase with a performance bonus fund equivalent to 10% of operating profit, maintaining that restricted stock units (RSUs) worth 5 million won—distributed to all employees—should also be included as part of the performance bonus scheme.

After the mediation process by the Gyeonggi Regional Labor Relations Commission was halted, the union obtained the legal right to strike at the end of May. On June 10, Kakao union members began a four-hour partial strike, marking the company’s first-ever strike. On June 29, a full-scale strike under the “Logout Day” campaign was held in the form of annual leave protests, and on July 21, union members also staged a picket protest at the corporate headquarters during lunchtime.

Despite ongoing collective action from the union, labor and management held 18 separate rounds of negotiations and reached a tentative agreement on July 29. The union then conducted a vote among its members, and with a majority in favor, the agreement passed and was finalized.

However, the main agenda item—performance-based compensation structure—was not included in the current agreement. Kakao’s management and the union agreed to resume discussions after October on matters such as whether RSUs should count toward performance bonuses, which had been a key point of contention.

A Kakao representative commented, “We plan to faithfully implement the agreements set during these negotiations and will work together to ensure a sustainable environment for growth, enabling our team to concentrate more effectively on their work.”

Meanwhile, labor-management conflicts persist at some Kakao affiliates. While the unions at Kakao Pay and Kakao Enterprise—both of which participated in collective action alongside the main union—have come to an agreement with management and ended their strikes, DKTechin and XL Games have yet to reach settlements. In addition, the KakaoBank union secured the right to strike and carried out the first-ever all-day walkout in Korea’s internet-only banking sector on July 31.

This content was produced with the assistance of AI translation services.