About 1,000 Related Employees Expected to Face Job Insecurity
The Kakao labor union is holding a rally opposing the spin-off of the portal site 'Daum.' This is in response to Kakao's push to spin off the content in-house independent company (CIC) that operates Daum.
The Kakao branch of the National Chemical, Textile, and Food Industry Labor Union (Hwaseom Food Union) (Crew Union) announced on the 17th that it plans to hold a press conference and rally on the 19th at the plaza in front of Kakao Pangyo Ajit in Seongnam, Gyeonggi Province, expressing opposition to the content CIC spin-off.
The union claims that Kakao management unilaterally notified them of the spin-off without prior discussion. Additionally, the union alleges that the company is considering a sale without concrete plans for the spun-off corporation.
The union stated, "The content CIC management has not disclosed specific operational plans for the spun-off corporation and has announced that they will proceed with the spin-off while even considering selling shares to revitalize the portal service. Since they have mentioned the possibility of selling shares, this decision is effectively no different from a sale."
They emphasized that if the spin-off is implemented, about 1,000 employees, including personnel related to the Daum service within Kakao and affiliated corporations, are expected to face job insecurity. They explained that over 300 people are involved in Daum services within Kakao's organizational chart, and including related personnel and directly involved individuals in affiliated corporations, the number is at least 800. Including indirectly related personnel, the union claims that about 1,000 employees are expected to face job insecurity.
The union expressed concern, saying, "Kakao's crisis began with an unprepared and reckless spin-off. Irresponsible spin-offs and sales will worsen everyone's working environment, generate discord and conflict among colleagues, and ultimately leave the crew neglected." They also added that wage negotiations are ongoing at 11 Kakao group corporations, but the management's refusal to negotiate performance bonuses has led to a prolonged deadlock.
Earlier, on the 13th, Kakao Content CIC informed employees at a town hall meeting about the plan to spin off to respond to competition in the portal, search, and content sectors. A Kakao official said, "We are preparing for the spin-off to enable Content CIC's leap forward, communicating with employees at one stage, and it must be finalized by the board of directors. We plan to strengthen service competitiveness by securing independence as a completely separate corporation, creating an environment for various experiments, and establishing a fast and independent decision-making structure."
Some speculate that Kakao's move to spin off Daum is part of a non-core business restructuring. Once the number one portal site in South Korea in terms of search market share, Daum's search share has declined to the 2% range as of last month. Kakao, which merged with Daum in 2014, separated Daum into a CIC in 2023.
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