Employees of Joyworks, the former exclusive distributor of Hoka in South Korea, announced Thursday they had formed an emergency committee to protest the decision by Hoka's global parent to replace them with E-Land as the brand's new domestic distributor. [Joyworks Emergency Committee]
Employees of Joyworks, the former exclusive distributor of Hoka in South Korea, announced Thursday they had formed an emergency committee to protest the decision by Hoka's global parent to replace them with E-Land as the brand's new domestic distributor. [Joyworks Emergency Committee]

Joyworks, the existing exclusive distributor of global sports brand Hoka in South Korea, has launched a collective protest after the brand's parent company selected E-Land as its new domestic distributor. The company and its partners say the switch is being rushed through while international arbitration over the contract termination remains unresolved, and they have vowed to fight back through rallies and a public petition drive.

According to industry sources Thursday, an emergency committee made up of Joyworks employees and partner companies formed in response to Deckers APAC — Hoka's operating entity — announcing E-Land as its new South Korean distributor that day. The committee stressed that Joyworks had built Hoka from a little-known brand into one generating annual sales of 100 billion won ($71.3 million) over eight years, and said the distributor replacement was being carried out unilaterally.

The dispute traces back to last December, when Deckers notified Joyworks of the termination of its domestic distribution contract after assault allegations surfaced against former Joyworks CEO Jo Seong-hwan. Joyworks filed for international arbitration with the American Arbitration Association's International Centre for Dispute Resolution, arguing the termination was unjust as it came before any ruling by investigative authorities or a court. That arbitration is currently ongoing.

"We have been informed by the company that a final arbitration ruling on the legality of the termination has not yet been issued," the committee said. "There should be no situation where the market moves as if everything is settled when the dispute has not been resolved." About 140 employees continue to work normally at stores and logistics sites.

The committee also said employees had been told that job security had been raised repeatedly in talks with the parent company, but that no concrete explanation had come from global headquarters. "It is unacceptable that employees who have nothing to do with an individual's case should pay the price with their jobs before that case is even concluded," the committee said.

The group directed sharp criticism at E-Land, the incoming distributor, saying the company appeared to be calculating that it could "seize the distribution rights first, drive a small and medium-sized enterprise into the ground, and then simply pay damages if legal problems arise." The committee called it "an extremely arrogant move that treats the livelihoods of employees and partner companies as bargaining chips."

The committee plans to formally report the situation to the Democratic Party of Korea's Euljiro Committee and launch rallies condemning E-Land along with a public petition campaign. "I stepped up because ordinary people's livelihoods and careers are on the line," said Jeon Hyeong-seop, the committee's chair. "We cannot accept a situation where we have to start rewriting our resumes before the outcome of eight years of work has even been decided."


spa@heraldcorp.com