Trade unions surge across tech as workers seek job security - The Korea JoongAng Daily

The photo shows union representatives from key tech companies in Pangyo, Gyeonggi. Nexon’s union is symbolized by the color blue, Kakao’s union by yellow, Naver’s union by green and Smilegate’s union by orange. [NAVER UNION]

The Korean tech sector is witnessing a rapid rise in labor unions, a trend that spread in recent years as employees start to pay more attention to job stability over growth in times of economic slowdown.

Yanolja, an accomodations platform that is part of Korea’s tech elite known as “NKLCBTDY” (Naver, Kakao, Line Plus, Coupang, Baemin, Toss, Danggeun, and Yanolja), has most recently joined the ranks of companies embracing unionization.

The Yanolja union officially launched on Jan. 23, operating under the Korean Chemical, Textile & Food Workers’ Union (KCTF)’s IT Committee, affiliated with the Korea Confederation of Trade Unions. Named Y-union, this recent addition follows the unionization trend that emerged in companies like NCsoft and NHN in Pangyo last year.

In the latter half of the previous year, Yanolja and its subsidiary, Yanolja Cloud, implemented measures such as reduced telecommuting and voluntary retirement. The union’s demands include transparent evaluation systems, fair compensation, the abolishment of an inclusive wage system and assurances of employment stability.

Officials from Y-union, the newly-formed labor union of Yanolja and Interpark, under the Korean Chemical, Textile & Food Workers’ Union (KCTF)’s IT Committee [YONHAP]

The impetus behind the increase of IT unions can be traced to the efforts of established unions. Under KCTF’s IT Committee, these unions have been at the forefront of successfully pushing for the abolition of fixed pay and addressing issues like crunch mode. Key players such as Naver took only three months after its union’s establishment in July 2018 to dismantle the fixed pay, with companies like Kakao, Nexon, and even non-unionized entities like Toss following suit in 2019. The NCsoft union, formed in April 2023, signed a collective agreement by the end of the same year.

Status of nationwide labor union organizations [YOO YOUNG-RAE]

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“There was consistent demand for union formation due to concerns about job insecurity and workplace harassment,” said Song Ga-ram, head of NCsoft’s labor union. “Taking into account regional and industrial factors, we have chosen the IT Committee, where companies that share common ground are united. The successes of unions affiliated with the IT Committee are likely to have had an impact on the formation of unions in other companies, including Yanolja.”

Adopting an approach that deviates from traditional political protests, the use of friendly initiatives like using names such as “Conquer the Space” (NCsoft) and “Krew Union” (Kakao), also played a role in the successful expansion of unions. In 2022, Naver’s union introduced gamelike elements into collective actions, such as assigning quests like “the participation of 200 employees” to boost engagement.

Despite the positive outcomes achieved by IT unions, concerns linger about their potential impact on the industry.

“Excessive demands from unions might hinder growth, compromise the performance-oriented culture and diminish dynamism within IT companies,” said a representative from a major platform company under anonymity.

Observations on the dual labor market structure are also worrisome.

“There is a widening wage gap between non-unionized IT companies compared to counterparts in large unionized companies,” said an employee from an IT firm without a labor union. “Unless individuals fall into the high-salary bracket of S-tier developers, there is a prevailing preference for unionized companies.”

Responding to these concerns, Cho Hyeok-jin, a researcher at the Korea Labor Institute, emphasized that major players like Naver and Kakao are actively working toward harmonizing labor conditions across subsidiaries and affiliates.

“The creation of standard labor conditions for developers and successful industrywide negotiations are identified as key points to watch,” Cho said.

With IT unions demonstrating tangible results, the momentum for union formation is expected to persist throughout this year.

“We will concentrate on improving labor conditions for IT professionals across the industry, regardless of distinctions between subcontractors or subsidiaries, and facilitate the inclusion of small- and medium-sized IT enterprises in the union,” said Oh Se-yoon, head of Naver’s union.