KRAFTON Faces Labor Violations Despite Record Profits in 2024

KRAFTON, the company behind PUBG: Battlegrounds, had a massive year financially in 2024—but it wasn’t all good news. Despite raking in over 1 trillion won in operating profit and 2 trillion won in sales, the company was hit with multiple penalties for labor violations, mostly related to unpaid wages and benefits.

According to a local media Chosun Biz report, KRAFTON and its subsidiaries received 11 penalties from government and public organizations between 2022 and the end of 2024. Of those, 9 were tied to employment and wage issues.

What Went Wrong?

One major issue happened in September 2024, when KRAFTON’s software development arm, Over There Korea, failed to pay two employees for their unused annual leave—a direct violation of South Korean labor laws, which require companies to compensate workers for any unused vacation days.

Another subsidiary, Bluehole Studio, ran into trouble in February 2024 for not paying wages to a former employee. South Korean law mandates that companies must settle final paychecks, severance, bonuses, and unused leave payments within 14 days after an employee leaves.

Then in December, KRAFTON’s creative studio Flyaway Games was called out by the Ministry of Employment and Labor for not factoring in unused leave when calculating retirement pension contributions for two employees.

KRAFTON’s Response

The company acknowledged these violations in its business report, stating:

“We have completed the implementation of the measures related to the above sanctions and are striving to prevent recurrence by strengthening management of compliance with laws and regulations.”

A Huge Financial Year—With Some Controversy

These issues stand in stark contrast to KRAFTON’s best-ever financial performance in 2024. The company reported:

• 2.7 trillion won in sales (up 41.8% from the previous year)

• 1.18 trillion won in operating profit (up 54.0%)

KRAFTON also paid its employees well—at least on paper. According to reports filed with the Financial Supervisory Service, the company paid its workers an average of 110 million won in 2024. That made KRAFTON the second-highest paying gaming company in South Korea, just behind Stellar Blade developer Shift Up, which paid around 130 million won per employee.

KRAFTON has been expanding aggressively on the global stage. Last year, the company invested in 13 international studios, including a high-profile move to save Tango Gameworks from shutting down. This not only kept the acclaimed studio alive but also ensured that most of its employees transitioned to KRAFTON instead of being laid off.

In India, KRAFTON has also ramped up its presence, supporting a dedicated local team of over 100 staff members to manage and develop Battlegrounds Mobile India (BGMI).

Additionally, KRAFTON is looking to tackle a major social issue in South Korea—its declining birth rate. Reports suggest the company is planning to offer childbirth incentives of up to 100 million won ($75,800) per employee, making it one of the most generous corporate policies in the country. This move could set a precedent in the gaming industry, encouraging other companies to follow suit.