Game companies screwed employees out of $3.9 million: ministry

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Game companies screwed employees out of $3.9 million: ministry

The labor ministry has warned local game makers that they have violated the labor act and screwed their employees out of 4.4 billion won ($3.9 million) or more.

The Ministry of Employment and Labor said Sunday the companies must pay the workers their due or be prosecuted. In addition, it imposed a total of 2.96 million won in fines on nine game companies for overworking its employees and other minor infractions.

The ministry conducted an investigation from February to April on 12 game developers including the top mobile game maker, Netmarble Games. A report released Sunday showed that 63.3 percent of employees at the developers worked over the legal limit for at least one week from February 2016 to January.

Game companies also failed to pay workers properly for overtime work. Unpaid wages among the 12 companies amounted to 4.4 billion won in total. Netmarble reportedly failed to pay 1.2 billion won worth of wages, according to the labor ministry.

Other notable infractions include failing to provide physical examination and violating the law banning companies from having a pregnant female working nights or on holidays.

The labor ministry ordered the companies to make corrections, including making payment of the unpaid overtime. The ministry added in the report that it will take legal action for violation of labor law if companies fail to comply.

The weekly working hours permitted by the Labor Standards Act in Korea is 52 hours. This includes 12 extended working hours.

When about 2,000 workers at the inspected companies worked over the legal limit, they exceeded it by an average of six hours. If an employee worked more than 52 hours during even one week in a year, it is considered a violation of the labor act.

The ministry said that “excessive amounts work required during ‘crunch mode’ (before the release of the new game)” was one of the key factors behind the poor working conditions. Also, it has become customary in the gaming industry for employees to work overtime. Many of the companies didn’t know the labor law. In addition to a 52-hour limit on working hours, the labor act stipulates that employers “shall additionally pay fifty percent or more of the ordinary wages for extended work.”

The report comes just a few months after the industry came under attack by the local media and civic groups. Last year, employees of some of the leading game makers in Korea died suddenly or committed suicide, leading experts to speculate about excessive working hours. Companies including Netmarble vowed they would improve their working environments. Remedies that the companies came up with included shortening or adopting flexible working hours and compensating their workers better.

Although the report did not disclose the names of the game makers, Netmarble issued a statement of apology following the release of the report and admitted to the infractions.

The game maker said it will use this opportunity to end a practice that has overshadowed game and information technology industries for years.

“It is true that at times we failed to properly manage [the working hours and payment of] our workers,” said Netmarble in a press release.

The company explained that since early March, it has banned employees working overtime or on weekends while prohibiting messaging between employees on work-related matters after work. It also no longer makes updates on its games at night.

The labor ministry added that Netmarble has agreed to various measures, including hiring an additional 1,300 workers by the end of this year. Netmarble will also form separate work schedules for night shifts.

In terms of labor hours, Netmarble said that the average weekly working hours of the company and its subsidiaries last year were 44 hours.


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