King reaches Swedish union deal hours before planned strike

STOCKHOLM — King, the Microsoft-owned mobile gaming company best known for developing “Candy Crush,” signed a collective bargaining agreement with Swedish unions hours before an open-ended strike was due to begin on a Friday morning. The deal covers employees at its Swedish offices, primarily in Stockholm and Malmö, and is scheduled to take effect on April 1, 2027.

The agreement followed state-supervised mediation with Unionen and Engineers of Sweden (Sveriges Ingenjörer), two prominent white-collar unions. It gives employees rights to advance notice and mandatory union consultations before management makes operational changes, alters working conditions or adjusts staffing. It does not give unions veto power over layoffs, but King must consult union leaders and provide formal justification before eliminating local roles.

The settlement came two days after Microsoft began another round of gaming job cuts, eliminating approximately 650 positions. In January, Microsoft had laid off 1,900 workers across its Xbox, Activision Blizzard and ZeniMax divisions. It later closed several subsidiary development studios, including Tango Gameworks and Arkane Austin.

Talks with King had been underway since May. Management opposed signing a collective agreement, arguing that its existing compensation and benefits were better than standard industry baselines and that a standardized Swedish agreement could leave employees worse off. Union representatives rejected that argument, saying discretionary corporate perks could be withdrawn without the legal protections of a collective contract.

Workplace organizing had gained traction in 2024 after King management unilaterally eliminated a subsidized private healthcare benefit. Employees then formed an internal union chapter to seek binding representation. After discussions stalled, the unions issued a formal strike notice on Sept. 15.

“This is an important step for King, the gaming industry and for the Swedish model,” Camilla Frankelius, head of negotiations at Engineers of Sweden, said in an announcement detailing the settlement. “We look forward to good cooperation with the company going forward and to the employees receiving the basic job security that almost nine out of 10 employees in Sweden have through collective bargaining agreements.”

The Swedish model relies on employers and unions to negotiate pay baselines, annual wage increases, working hours, occupational pensions and severance terms. Unlike most European Union member states and the United States, Sweden has no statutory minimum wage set by legislation. Approximately 90% of its total labor force is covered by collective agreements.

The Nordic video game industry historically operated outside that framework, though Swedish publisher Paradox Interactive signed an agreement covering its domestic staff in 2020, and Avalanche Studios entered into a similar accord for its Swedish employees. Elsewhere in Sweden, international companies have clashed with local labor practices, including in an extended dispute between industrial union IF Metall and American automaker Tesla over recognition of collective bargaining.

King was founded in Stockholm in 2003 and became one of the world’s most lucrative mobile developers after the 2012 launch of “Candy Crush Saga.” Activision Blizzard bought King in 2016 for $5.9 billion; Microsoft acquired Activision Blizzard in October 2023 in a transaction valued at $68.7 billion.

Unionization has also expanded across Microsoft’s video game operations in North America. Facing regulatory scrutiny during the Activision Blizzard acquisition, Microsoft signed a labor neutrality agreement with the Communications Workers of America (CWA) in 2022, pledging not to oppose organizing campaigns at its studios. Since then, hundreds of quality assurance workers at ZeniMax Online Studios formed the company’s first domestic union, followed by staff at Bethesda Game Studios and a wall-to-wall union of more than 500 developers on Blizzard Entertainment’s “World of Warcraft” team.