Kakao’s labor and management have entered mediation at the Gyeonggi Provincial Labor Relations Commission after failing to narrow differences over the size of performance bonuses in 2026 wage talks. If mediation also breaks down, the possibility of a strike cannot be ruled out.

Industry sources said on May 11 that the Kakao branch of the Korean Chemical, Textile and Food Industries Workers’ Union filed for mediation with the Gyeonggi Provincial Labor Relations Commission, effectively ending the 2026 wage talks. Unions from 4 entities joined the request: Kakao’s headquarters, Kakao Pay, Kakao Enterprise and DK Techin.

The key sticking point is performance bonuses. The union’s requested bonus level is said to reach about 13 to 15 percent when converted based on Kakao’s operating profit last year of 440 billion won, which would amount to about 15 million won per employee if applied.

The union drew a line, saying it did not directly demand a certain percentage of operating profit. Kakao Enterprise and DK Techin are loss-making entities, making it structurally impossible to apply a standard based on the operating profit ratio itself.

The industry views SK Hynix’s case of deciding to pay 10 percent of operating profit as performance bonuses as having influenced the union’s demand level. The union, however, says it is an extension of the bargaining process that has continued since late last year and is separate from performance-bonus conflicts across the broader IT industry.

The labor board’s mediation session is scheduled for May 18. If mediation breaks down, the union will obtain the authority to move to industrial action such as a strike after a vote by members. The Kakao union also went through the same process in 2024.

Kakao said, "We were unable to reach a final agreement in the process of designing the compensation structure," adding, "We will engage sincerely in the mediation process and keep channels for dialogue open."