KOTRA Applies Differential Wage System Based on Job and Responsibility... First Case Among Large Public Institutions

[Asia Economy Reporter Suyeon Woo] KOTRA is introducing a job-based pay system that applies wages differently according to the difficulty and responsibility of the job. KOTRA is the first large public institution with over 1,000 employees to abolish the seniority-based pay system and adopt a job-based pay system.

According to the industry on the 10th, the KOTRA labor union recently approved the agenda of 'abolishing the seniority-based pay system and introducing the job-based pay system' with a 79% approval rate. KOTRA plans to hold a board meeting at the end of this month to approve the change in the salary system and implement it from the first half of the year.

Since its establishment in 1962, KOTRA has maintained a seniority-based pay system (levels 1 to 40) where wages increase according to years of service for over 50 years. The high approval rate for this agenda within KOTRA reflects the contemporary opinion that it is reasonable for public institutions, once called "iron rice bowls," to pay annual salaries based on the amount of work done.

To this end, KOTRA divided all employees' tasks into four job groups based on the difficulty, importance, and scope of responsibility of the work, and then further subdivided them into 16 levels considering years of service. For example, employees working at trade offices who pioneer major overseas markets and receive many requests from domestic companies are assigned relatively higher salary grades.

The Korea Petroleum Management Service was the first public institution to apply a differentiated wage system in July last year, and KOTRA is the first large public institution with over 1,000 employees to do so.

The government expects this trend of adopting job-based pay systems to spread throughout public institutions. The Ministry of Economy and Finance decided at the end of last year at the Public Institution Management Committee to reflect additional points in this year’s public institution management evaluations based on whether the job-based pay system is introduced, and it is known that about ten public institutions are already reviewing the adoption of the job-based pay system this year.

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