"Disability Employment Incentives Should Apply Minimum Wage Standards When Paying Wages"

[Asia Economy Reporter Moon Chaeseok] The Korea Employment Agency for the Disabled has been ruled by an administrative tribunal that the minimum wage standard at the time of wage payment, not the time of subsidy payment, should be applied when paying the 2018 disability employment incentive.

The Central Administrative Tribunal under the Anti-Corruption and Civil Rights Commission (Central Administrative Tribunal) announced on the 6th that the Korea Employment Agency for the Disabled's decision to refuse payment of the 2018 disability employment incentive to Company A was incorrect.

Company A, which signed a cleaning service contract with Korea Railroad Corporation, applied to the agency for the 2018 disability employment incentive in January last year.

The disability employment incentive is a subsidy paid by the agency according to the number of disabled workers employed by the employer exceeding the legally mandated employment quota, excluding disabled workers who received wages below the minimum wage.

In this case, for monthly salaried disabled workers, the paid wage is divided by the 'prescribed monthly working hours' and converted to an hourly wage to compare with the statutory minimum wage.

The agency applied the revised Minimum Wage Act of 2019 when calculating the incentive for Company A, including paid weekly holiday hours, and refused payment stating that "three disabled workers received wages below the minimum wage."

This is because the enforcement decree of the revised Minimum Wage Act requires including paid weekly holiday hours when calculating the 'prescribed monthly working hours,' which is the basis for determining minimum wage payment.

Company A filed an administrative appeal with the Central Administrative Tribunal in June last year, claiming that the agency's refusal to pay the incentive was illegal and unjust.

The Central Administrative Tribunal stated that the principle is to apply the revised law in effect at the time of the incentive application for administrative disposition.

However, considering that the incentive period was for 2018 and that the Supreme Court has repeatedly ruled that paid weekly holiday hours are not included when calculating 'prescribed monthly working hours' under the pre-revised law, the tribunal took this into account.

It also judged that it was necessary to protect public trust in the hourly wage conversion method under the pre-revised law.

Accordingly, the Central Administrative Tribunal stated that applying the pre-revised law, the wages paid to the workers all meet the minimum wage, and the agency must pay the incentive for the three disabled workers.

This content was produced with the assistance of AI translation services.