First Meeting on Next Year's Minimum Wage Today... Labor and Management Clash

Minimum Wage Commission Holds 1st Plenary Meeting
Controversy Over Public Interest Members' Positions

On the afternoon of July 7 last year, the 5th plenary meeting of the Minimum Wage Commission of that year was held at the Ministry of Employment and Labor in the Government Sejong Complex, chaired by Park Junsik, the chairman of the Minimum Wage Commission. (Image source=Yonhap News)

[Sejong=Asia Economy Reporter Moon Chaeseok] The intense tug-of-war between labor and management over next year's minimum wage decision begins on the 20th.

The Minimum Wage Commission, the body that deliberates and decides the minimum wage, will hold its first plenary meeting of the year at the Press Center in Jung-gu, Seoul, in the afternoon. The commission consists of 27 members: 9 each of worker representatives, employer representatives, and public interest members. This meeting serves as an introductory session for deliberations on next year's minimum wage. The minimum wage for next year will be the last to be decided during the Moon Jae-in administration.

Under the current administration, the minimum wage increased by 16.4% in 2018 (based on the applicable year) and 10.9% in 2019, but the increase rate dropped to 2.9% last year and fell further to a record low of 1.5% this year. The minimum wage this year is 8,720 won per hour. The current administration's pledge to raise the minimum wage to 10,000 won by 2020 has become a broken promise.

The labor sector is determined not to yield any further, as the management's demands have been accepted for two consecutive years in the minimum wage deliberations. The labor side argues that the minimum wage must be raised above a certain level to support the livelihoods of low-wage workers who have been adversely affected by the COVID-19 pandemic.

On the other hand, the management argues that the burden of labor costs due to the sharp increase in the minimum wage in the early days of the current administration still remains, and that the ability of small business owners to pay wages has worsened due to the COVID-19 crisis, so next year's minimum wage should be kept at a freeze level.

In the tense confrontation between labor and management, the key to the minimum wage deliberations lies with the public interest members recommended by the government. Among them, except for the standing member at the director level of the Ministry of Employment and Labor, the terms of 8 members will expire next month. Since the labor sector is demanding the replacement of public interest members who have put the brakes on the minimum wage increase trend, whether these members will be retained is expected to be the first point of conflict between labor and management.

Once the Minimum Wage Commission decides on the minimum wage, the Ministry of Employment and Labor must announce it by August 5. Considering the objection procedures before the announcement, the commission must complete deliberations by mid-July.

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