Fair trade body warns SM on ‘slave contracts’SM Entertainment, Korea’s leading entertainment agency, was warned against forcing singers and trainees to sign unfairly long exclusive contracts, the Fair Trade Commission said in a release yesterday.
The company, which manages such popular groups as Girls’ Generation and BoA, was also slapped with an order to correct overly long contracts with trainees within three years.
In the past, SM Entertainment’s exclusive contracts with singers and trainees lasted 10 years after their debuts or 13 years after contracts were signed. However, the company voluntarily cut the duration of its contracts to seven years after debuts when the commission started investigating the issue, the commission said.
SM Entertainment’s former contracts also levied heavy penalties on talent who broke their contracts. Those who broke contracts were required to pay three times the company’s total investment in their training or twice the expected profit in the remaining period of the contracts. However, the company eased the penalty to a two-year average profit.
The company has been modifying contracts with its singers and trainees since April and the changes are almost complete, the commission said. Therefore the company was given only a warning, the commission said.
Korea’s entertainment agencies are notorious for their “slave contracts” with their talent.
By Limb Jae-un [email@example.com]