King Turns Down Swedish Union Deal After Year of Negotiations

King has rejected a collective bargaining agreement covering its Swedish workforce, ending nearly a year of negotiations with the trade unions Unionen and Sveriges Ingenjörer without a deal. The Candy Crush developer told employees of the decision in June 2026 in an internal email from company president Todd Green, Kotaku reported on August 5, 2026, after obtaining the message and receiving on-the-record statements from both King and Unionen.

The decision lands two years into a unionization effort at King’s Stockholm studio, and in the middle of a corporate restructuring: King was among the studios hit in the Xbox-wide layoffs in July 2026, and earlier reductions at the company ran through 2025. How many of those cuts fell on the Swedish operation has not been disclosed.

Why King Says It Walked Away

In the June email, Green gave staff two reasons for declining the agreement, according to Kotaku’s report. The first is benefits. King argues its current package, which includes an enhanced pension, long-term sick pay, private health insurance, and parental leave, is better for employees than what a collective agreement would deliver. Signing one would not force King to drop those benefits, Green wrote, but it would require restructuring them in ways the company believes would leave Swedish employees worse off.

The second is consistency. King runs studios across Europe and the United States, and Green told staff the company wants a “consistent and equal experience for all” employees across them. Adopting a collective agreement in Sweden alone would require “significant changes to how we operate in Sweden, including our processes, policies, and ways of working,” the email said.

In its statement to Kotaku, King said its terms already match or exceed what a collective agreement would provide, and that it “remains committed to continuing this respectful and transparent dialogue on important employee matters.”

Where the Unions Go From Here

Unionen, Sweden’s largest private-sector trade union, said the decision came “despite clear demands from Unionen members at King, who have expressed a desire for the security, transparency, and employee influence that a collective agreement provides.”

A rejection is not necessarily the end of the road. Under the Swedish model, the terms of employment are set by agreements between unions and employers rather than by law, and roughly 70 percent of Swedish employees are union members. Employers are required to negotiate in good faith but can decline to sign, as King has; the union’s leverage from there is member pressure and, ultimately, collective action. Unionen said its dialogue with members at King will resume after the summer to discuss the way forward, and that its long-term ambition remains bringing more of the Swedish labor market under collective agreements. Sveriges Ingenjörer, which also represents King staff, had not commented publicly at the time of Kotaku’s report.

The Swedish games industry has precedent for the agreement King declined. Paradox Interactive announced in June 2020 that it would sign a collective agreement with Unionen and SACO covering all of its Swedish studios, and Avalanche Studios went through the same process in 2024.

How King’s Sweden Push Fits Inside Microsoft

King’s Stockholm staff formed their union club in late 2024 after the company removed a private-doctor benefit from its package, a change made without employee consultation that galvanized the organizing effort. CBA negotiations opened in 2025.

The rejection draws a line between how King’s parent company handles labor in the United States and how it is handling labor in Sweden. Microsoft signed a labor neutrality agreement with the Communications Workers of America in June 2022 (MSFT ), pledging to stay neutral when covered employees express interest in joining a union, a commitment it extended to Activision Blizzard (ATVI ) workers when the acquisition closed. A string of U.S. bargaining units followed: Raven Software’s QA testers, roughly 600 Activision QA workers, Bethesda Game Studios, World of Warcraft’s developers, Blizzard QA teams in Albany and Austin, and Overwatch and Diablo teams. Microsoft has not made a comparable neutrality commitment to any union other than the CWA, and the Swedish framework is different in kind: rather than recognizing a bargaining unit and negotiating a U.S.-style contract, King was asked to sign onto the sector-wide model that governs most Swedish workplaces.

That U.S. relationship has its own friction. The CWA has said contract negotiations at Microsoft-owned ZeniMax have stalled, and the union recently filed a labor charge over Microsoft’s Xbox layoffs. The cuts reached deep into the gaming division this summer as Xbox revenue fell even as Microsoft posted a record year.

King’s decision leaves its Swedish employees with the company’s existing terms intact and the union club in place. Unionen has said it is not done: its member dialogue at King resumes after the summer, with securing a collective agreement still the stated goal.