Gwangju City and Companies Urgently Need Countermeasures for Supreme Court Ruling on Ordinary Wages

Chae Eunji, Gwangju City Council Member: "Easing Confusion in Local Industrial Sites"
"City Should Work to Minimize Business Difficulties and Labor-Management Conflicts"

Eunji Chae, Gwangju City Council member.

With the Supreme Court ruling that "conditional regular bonuses," which are paid based on employment status or meeting certain work period requirements, must also be included in ordinary wages, there are calls for proactive measures to address the impact on the local industrial sector.

On the 23rd, Chae Eunji, a proportional representative of the Gwangju Metropolitan Council from the Democratic Party, stated, "The Supreme Court's en banc decision that bonuses paid conditionally can be recognized as ordinary wages if certain requirements are met is expected to cause considerable confusion in local workplaces. In particular, since organizations under the Gwangju city government and local manufacturing industries may be directly affected, there is an urgent need for on-site surveys and discussions to prepare countermeasures."

Chae also argued, "It is urgent to accurately identify the items included in ordinary wages, establish a new budget for personnel expenses, and review employment contracts, work rules, and collective agreements."

She further stated, "To prepare for increased labor costs, it is necessary to consider various work arrangements such as reducing working hours, introducing flexible work systems, automation, and utilizing remote work. These measures can improve the quality of working life for employees and serve as a long-term strategy to enhance corporate competitiveness."

The Supreme Court's en banc panel ruled on the 19th that even if a "condition of employment" or "requirement to work a certain number of prescribed days" is attached to the criteria for paying bonuses, they must still be regarded as ordinary wages. This ruling came in a wage claim lawsuit filed by Hanwha Life and Hyundai Motor employees against their companies. Previously, only bonuses whose payment and amount were predetermined (so-called "fixed bonuses") were considered ordinary wages, but this standard has now been abolished after 11 years.

Ordinary wage refers to "remuneration paid to employees for prescribed work," and is used as the basis for calculating allowances and severance pay that employees can receive.

Meanwhile, Chae urged, "Measures are needed to minimize business deterioration, labor-management conflicts, and workplace confusion, and to promote local economic development and job stability. I hope Gwangju City will actively address local labor and employment issues."

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