Slave Contracts: the Dark Side of the K-pop Industry
K-pop idol Chuu recently surprised fans with her departure from her group, Loona. The 12-member group, produced by the label Blockberry Creative, debuted in 2016 with an ambitious pre-debut project that attracted the attention of many K-pop fans. Each member of the group released a promotional single over the course of 18 months, a method unfamiliar to the industry. Since the group’s grand debut, one particular member caught the eye of the general public: Chuu. She gained attention for her aegyo (cuteness) and bright energy on variety shows, causing her to participate in several well-known shows (How Do You Play, Steel Troops, etc.), and host her own web series on YouTube (Chuu Can Do It), attracting more fans.
As the unquestionable face of the group, Chuu built a promising career, even filming the television commercial of Dong-a Otsuka's Pocari Sweat, a commercial featuring the most famous female celebrities of the time, such as actress Son Yejin and K-pop group Twice. Though the public expected the idol to continue her career under Blockberry, it was revealed in March 2022 that Chuu had filed to terminate her contract with her label the year before, and received partial approval from the court. The main reason behind this conflict was the company’s failure to properly pay the idol. Despite her numerous television appearances and commercials, Chuu was paid only 70,000,000 won (approximately 56,000 dollars) throughout her four years as an idol, failing to meet even minimum wage. However, the idol’s lack of payment wasn’t simply due the company’s sudden refusal to pay her. The problem was rooted in the unfair contract Chuu had signed with the company on Dec. 4, 2017: a slave contract.
Following her removal from the group in December 2022, an investigation conducted by Dispatch, an online media outlet specializing in the Korean entertainment industry, revealed that the idol’s contract caused her to be paid a minimal amount, regardless of how much she worked. The contract distributed the income generated from all her activities as 70% to 30% to Blockberry Creative and Chuu respectively. Meanwhile, the expenses required for the activities of Chuu were settled at a 50:50 split. Additionally, the contract outlined that the revenue would first be divided and then the cost would be subtracted, meaning 20% of the cost that Blockberry should have borne went to Chuu.
Chuu’s contract with her label is a prime example of a slave contract. Slave contracts, by definition, are unfair and long-term agreements signed between an idol and the management agency that are exploitative in nature. Examples of this include, but are not limited to, unfair profit distribution, excessively long contracts, harsh working conditions, and excessive control over idols’ personal lives.
Slave contracts like Chuu’s with Blockberry aren’t a new concept in the Korean entertainment industry. An investigation of 20 entertainment companies conducted by the Korea Fair Trade Commission in 2009 revealed that 230 out of 230 contracts signed possessed unfair contract terms, with one company not even signing a contract with its idols. Some of the biggest labels in the industry were implicated: YG Entertainment, DY Entertainment, DSP Media, and Barunson Entertainment. There were several big names signed with these companies, such as boy groups Big Bang and soloist Seven, comedians Shin Dongyup and Yoo Jaesuk, girl groups KARA and Rainbow, and actresses Hwang Shinhye and Son Yejin. These contracts excessively invaded the celebrities’ privacies, requiring them to report their location at all times and to obtain approval before travelling overseas. Additionally, the contracts restricted the freedom to choose an occupation, as contract terms stated celebrities would not be allowed to conduct any entertainment activities upon the contract’s termination and that celebrities would not be able to halt activities or retire without permission while the contract is in act.
These slave contracts were first brought to light to the public when boy group TVXQ sued their label, SM Entertainment, in 2008, stating that the 13-year contract they signed with the label was unfair. Specifically, throughout the lawsuit, the members brought up their harsh working conditions and the little to no pay they received in exchange for such work. Much attention was brought to the lawsuit, as TVXQ was one of the leading members of the second generation of K-pop, playing a significant role in the ‘hallyu wave’ that put Korean culture on the global stage. Furthermore, the label was one of the biggest entertainment companies in Korea, with both the company and founder, Lee Sooman, being familiar to the public as they possessed a rich history, having produced major K-pop acts such as H.O.T., S.E.S., Shinhwa, BoA, Super Junior, and SNSD.
In response to such controversies, the Fair Trade Commission (FTC) established restrictions to contracts in the entertainment industry. In 2009, the FTC limited contracts to seven years, instead of the previously standard 13-year contracts. Additionally, in 2017, the FTC enacted reforms in regards to the financial penalties for broken contracts with trainees and specified clauses that made it difficult for companies to pressure idols into renewing contracts after their expiration.
However, despite these restrictions and reforms, slave contracts aren’t just a thing of the past, as can be seen by Chuu’s lawsuit with Blockberry Creative. Many idols are still subjected to unfair treatment from labels who continue to exploit them by forcing them to undergo inhumane conditions for little to no pay. It’s clear that the K-pop industry still has a long way to go to make the work as enjoyable as it seems from the outside. This can mostly be attributed to the lack of regulations addressing other pressing issues on standardized contracts. Lee Choong-hun, a professor at Incheon University’s law school, states, “The regulations are hugely favorable to the management agencies.” To address such shortcomings, the FTC should work to create more regulations addressing unfair clauses prevalent in contracts. As a government agency, the FTC bears the responsibility to protect hundreds of idols from exploitative contracts.