How the K-Pop industry is structured and new groups are created is facing renewed scrutiny. A long-standing debate over what some call "slave contracts" and the intense trainee incubation system has reached a boiling point following a New York Times investigation into one of the genre’s biggest acts, NewJeans.
As K-pop continues its massive global expansion, the collision between Korean entertainment business practices and Western artist and labor expectations are colliding.
It begins with how K-pop acts are created.
How K-Pop Groups Are Created
Unlike the Western tradition of bands forming in garage or basement, K-pop acts are engineered through a multi-tiered pipeline.
The journey begins with aggressive global scouting where entertainment powerhouses recruit raw talent based on star potential, charisma, and visual marketability.
Once signed, hopefuls enter an often grueling training bootcamp system that can last that can last years. Trainees reside in company-run dorms and endure intense schedules including vocal lessons, synchronized choreography, media training, and foreign languages like English and Japanese.
Monthly evaluations and eliminations maintain constant pressure.
Executives then assemble lineups with surgical precision. To maximize group synergy and avoid internal competition, rosters are curated around distinct, non-overlapping roles: main vocalists, lead dancers, rappers, and designated "visuals." At the same time creative directors and A&R teams architect a group's overarching concept. That includes a musical style - newtro, semi-trot, bubblegum pop, retro synthpop and more - with bespoke tracks, signature choreography, high-budget visuals and a rollout designed to drive immediate engagement.
Often this development cycle plays out in front of cameras.
Through high-profile televised survival competitions, agencies broadcast the audition and elimination process directly to viewers. By allowing fans to vote on the final lineup, entertainment companies build an intensely loyal, monetizable fanbase long before the group's official debut single hits streaming platforms.
Then NewJeans Did the Unthinkable
K-pop superstars NewJeans set a Guinness World Record as the fastest K-pop act to surpass 1 billion Spotify streams. It took just 219 days. They went on to win 35 music awards and sell more than 8 million albums.
But two years ago, the five members did something that no successful K-pop stars had done in a several decades. NewJeans quit their record label.
A year after their album “Get Up” debuted at No. 1 on the U.S. charts, member Hanni Pham accused of label ADOR of “deliberate miscommunications and manipulation” and said that “staying at the company will only prolong our psychological pain." Other members spoke out too.
+Read more: "The Context Behind K-Pop’s Biggest Scandal"
New York Times Looks at "Dark Side Of K-Pop"
The New York Times analyzed contracts signed by the five members of NewJeans with K-pop giant HYBE affiliate ANDOR when they were between the ages of 14 and 17.
According to the leaked contracts, the agreements heavily favored the company and contained some controversial clauses:
- Omission of Minor Protections: The main contracts reportedly lacked explicit clauses common in the West guaranteeing the underage members’ rights to "sleep, rest and free choice."
- Take-it-or-leave-it: "Instead of going to school, the teens had spent years living in dorms and training for a shot at fame with the label. When one parent worried about the onerous contract terms, the label said it would accept no meaningful alterations. She signed."
- Financial Burdens: The agreements included aggressive financial terms like requiring the young trainees to bear the costs of skincare, beauty treatments, and cosmetic procedures.
- Behavioral Clauses: Members were prohibited from exhibiting an "insincere attitude," inadequate self-management, or entering into inappropriate romantic relationships.
- Huge Exit Fees: The contract included exit fees even when terminated by the label. One member was forced out over an alleged unauthorized solo project and photo shoot and sued for $22 million. Her lawyer called it a warning to other performers.
- Perpetual AI Rights: The contract granted ADOR the right to use the members' likenesses and voices for AI chatbots or clones, even beyond the duration of their exclusive agreements.
HYBE and the K-Pop Industry Push Back
HYBE and subsidiary ADOR moved quickly to try to counter the narrative, framing the leak of confidential litigation materials as an orchestrated attempt to attack the K-pop industry.
HYBE maintains that while the main contract may not have explicitly detail protections for minors, all of its labels execute separate, government-mandated supplementary agreements for underage trainees. These supplementary documents legally enforce personal rights, including education, sleep, and rest, remaining active until the artist reaches adulthood.
The Korea Popmusic Industry Association also criticized the New York Times for a "one-sided and biased assessment". The trade group argued that Western media fundamentally misunderstands the K-pop incubation system, failing to account for the massive upfront financial risks agencies take to develop talent, as well as legal safeguards like the "Standard Exclusive Contract for Popular Culture Artists" enforced by the South Korean government.
+Read more: "The Spotify Paradox: More Powerful, Impossible to Leave"
Hypebot's Bottom Line
The unprecedented international success of K-pop means that its internal business mechanics are subject to Western regulatory oversight as well as the court of public opinion.
Companies like HYBE that want to protect the major financial investments required to manufacture global superstars must also now manage international PR surrounding labor rights and minor protections.
Artists and their fans just want all artists to be treated fairly.
