NAVER Z proposes wage freeze amid worsening business conditions

NAVER Z, the company behind the popular metaverse platform Zepeto, is facing labor disputes as it proposes a wage freeze for its employees, a move unprecedented in the company's history. The proposal was made on June 24 due to deteriorating business conditions, according to company officials.

The labor union rejected the wage freeze, leading to a breakdown in negotiations. This impasse has prompted the initiation of mediation procedures with the labor committee. This marks the first time since the establishment of the integrated NAVER union in 2018 that the company has proposed a 0% wage increase.

The first mediation session is scheduled for July 16 at the Gyeonggi Regional Labor Relations Commission. If mediation fails, the union may proceed to a strike vote among its members.

NAVER Z, which was spun off as a separate entity in 2020 to manage the Zepeto business, has been struggling in the post-pandemic era. The initial boom in the metaverse sector has subsided, and the company is facing difficulties in converting its user base into revenue. Last year, NAVER Z reported a revenue of 66.3 billion won, a 14.4% decrease from the previous year, and an operating loss of 49.4 billion won.