Kakao enters final wage talks as union threatens partial strike June 10

"A four-hour partial strike on the 10th and a mass rally" — union. "A level that places a significant burden on company management" — Kakao management.

Kakao and its union are heading into final wage negotiations this week, facing what would be the company's first strike in its history.

Management has made clear it cannot accept the union's demands, calling them "beyond what the company can bear," while the union has announced a four-hour partial strike on June 10 alongside a mass rally, setting up a standoff between the two sides.

With the two sides having made little progress, all eyes are on whether they can find common ground before what would be the company's first general strike in history.

According to industry sources Sunday, Kakao and its union will hold final negotiations this week to narrow their differences over this year's wage agreement. With the union having announced the four-hour partial strike for June 10, both sides are treating that date as the final deadline for talks.

The union said Sunday it would carry out a four-hour partial strike rather than an immediate full walkout, and would escalate strike action depending on how subsequent negotiations unfold.

"The core demands of the Kakao chapter are clear," the union said. "We need to stop the selloffs, spinoffs and restructuring driven by repeated management failures, and secure job stability." The union also called for an overhaul of the executive compensation structure, saying management had "monopolized outsized rewards while causing job insecurity through poor decision-making."

Alongside the partial strike on June 10, the union announced a mass rally of around 1,200 participants, with a march from the Pangyo Station area in Seongnam, Gyeonggi Province, to Yuspace running from 9 a.m. to 4 p.m.

Kakao management, meanwhile, has made clear it will not accept the union's performance compensation proposal and is weighing a firm response.

After the second mediation session broke down, Kakao said in a statement that "the total scale of the performance compensation proposal currently demanded by the Crew Union represents a significant burden on company management when measured against operating profit," adding that "performance compensation for crew members must be balanced and sustainable, taking into account future investment capacity and shareholder value."

Kakao Chief Executive Jeong Shin-a also signaled in an internal notice that the company needed to "establish a stable framework at the corporate level, reset service-oriented standards, and align direction together," hinting at a partial organizational restructuring.

Even so, Kakao left the door open for a negotiated resolution. "We will keep the path of dialogue open until the very end and do our utmost to avoid any impact on shareholders, partners and other stakeholders," the company said.

Jeong added that while "the two sides have not yet sufficiently narrowed their differences, we are ultimately crew members who work together within Kakao and must move in the same direction," and said she would "make greater efforts to listen to each other, resolve differences through dialogue, and unite once again as one Kakao."

After the second mediation between Kakao and its union failed on May 27, the unions at Kakao and its affiliates — including Kakao Enterprise, Kakao Pay, DK TechIn and XL Games — secured the legal right to strike.

The central sticking points in the final negotiations are performance bonuses and long-term compensation. Management has proposed allocating 10 percent of last year's standalone operating profit along with restricted stock units worth 5 million won (approximately $3,330), but the union is said to be demanding performance bonuses equivalent to 13 to 14 percent of last year's standalone operating profit — which stood at 440.2 billion won — plus RSUs of around 5 million won on top of that.

If the partial strike escalates into a full general strike, Kakao would face its first headquarters-level walkout in more than 20 years of operation. While Kakao Mobility carried out a partial strike in June last year, the parent company itself has never seen a strike.

Kakao said it is putting in place contingency measures to prevent any service disruptions and will make every effort to maintain stable service operations.