Minimum Wage Commission Misses Legal Deliberation Deadline Again... Uncertainty Over Release of Initial Proposal Today

Third Full Meeting Held on the Legal Deadline of the 29th
Unable to Decide on Initial Proposal Presentation
Full-Scale Discussion on Differential Application by Business Type
Clear Differences Between Labor and Management Opinions... Difficulties Expected

[Image source=Yonhap News]

[Asia Economy Reporter Kim Bo-kyung] The Minimum Wage Commission has once again failed to meet the legal deadline for reviewing the minimum wage. Violations of the legally mandated minimum wage review deadline have become an annual occurrence. It is uncertain whether the initial wage demands from labor and management will be submitted at the third meeting scheduled for the 29th.

The Minimum Wage Commission (Chairman Park Jun-sik) will hold its third plenary session in the afternoon at the Government Complex Sejong to continue discussions on the minimum wage level to be applied next year. This day marks the legal review deadline stipulated by the Minimum Wage Act. According to the Minimum Wage Act, the commission must submit a minimum wage proposal within 90 days from the date it receives a review request from the Minister of Employment and Labor. It is unlikely that the commission will reach a conclusion by this day, which is 90 days after Minister Lee Jae-gap requested the review.

This is because the initial wage demands from labor and management, which signal the start of substantive minimum wage deliberations, have not yet been presented. Neither side has revealed their cards. Previously, the Korean Confederation of Trade Unions (KCTU) proposed its own demand of 10,770 won, but a unified labor demand must be presented through consultation with the Federation of Korean Trade Unions (FKTU).

Kim Dong-myeong, chairman of the FKTU, stated that the minimum wage demand would be proposed below 10,000 won, but this was not a statement agreed upon internally. An FKTU official said, "(Chairman Kim’s claim) is not a shared internal position," adding, "The initial demand is currently being discussed among the working-level representatives of the two major trade unions."

The management side has also not decided whether to disclose its initial demand at this meeting. A user committee member told Asia Economy in a phone interview, "We are coordinating opinions among user committee members on whether to present the initial demand."

Before the initial demand is submitted, there is another hurdle to overcome: whether to apply differentiated minimum wages by industry and company size, as requested by management. Small business owners and the service industry, which were hit hard by the COVID-19 pandemic, strongly advocate for this, but the labor side maintains its opposition. At the second plenary meeting, labor and management smoothly agreed by applause to decide on the dual notation of hourly and monthly wages. However, the third meeting is expected to be difficult as it will address the contentious issue of differentiated minimum wage application.

Meanwhile, the deadline for announcing the minimum wage is August 5, and considering administrative procedures such as objections, the review must be completed at least 20 days prior for legal effect. Last year, the next year’s minimum wage was decided on July 12; in 2018, on July 14; and in 2017, on July 15.

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