Wage and bonus negotiations between Kakao headquarters and its labor union have collapsed, raising the prospect of the first-ever strike at the company's main office. With unions at several affiliates already securing the right to strike, the dispute could escalate into a group-wide walkout.
According to the information and communications technology (ICT) industry on the 27th, Kakao's management and union failed to narrow their differences over key issues at a second mediation session held that afternoon at the Gyeonggi Regional Labor Relations Commission. The commission ultimately ruled to suspend mediation.
As a result, the Kakao union has obtained the legal right to strike, and Kakao now faces the possibility of its first headquarters-level walkout since its founding.
The two sides had previously held a mediation session on the 18th but failed to reach an agreement. Even after postponing the next mediation date, they could not find common ground.
However, the breakdown in mediation does not immediately translate into a strike. The union plans to determine the timing, scale and form of collective action through internal discussions. Industry observers note that an actual strike may take some time, given the need to gather member input and coordinate with affiliate unions.
At the heart of the dispute are the criteria for performance bonuses and the restricted stock unit (RSU) compensation system. The union is reportedly demanding that bonuses be set at 13-14% of last year's operating profit and that 5 million won worth of RSUs be excluded from bonus calculations.
The union argues that compensation for rank-and-file employees has fallen short despite improved company performance, and that bonus and RSU criteria lack transparency, requiring systemic reform.
Management has reportedly offered multiple compensation proposals but failed to bridge differences over how bonuses are calculated and how the long-term compensation system should be formalized. The company maintains that the entire compensation framework must be reviewed comprehensively, taking into account AI business expansion and future investments.
Unions at several affiliates — including Kakao Enterprise, KakaoPay, DK Techin and XL Games — have already secured the right to strike. With strike votes also passing, a joint response spanning headquarters and affiliates is being floated as a possibility.
While Kakao Mobility staged a partial strike last year, there is no precedent for a strike at Kakao's headquarters itself. The union is therefore expected to carefully calibrate its response, mindful of the symbolism and broader impact of a first-ever headquarters walkout.
Industry watchers say the labor dispute could affect Kakao's push into new AI businesses and its organizational stability. Kakao has recently been accelerating efforts to expand its artificial intelligence (AI) business and restore external trust.
Following the breakdown in mediation, management is expected to first brief employees on the negotiation process and the company's position before mapping out its next steps.
