Minister of Employment An Kyung-duk Urges "Rational Decision" Despite KCTU's Boycott and 'Stalemate' in Meetings
The scene of the 2nd plenary meeting of the Minimum Wage Commission held on the 18th at the Minimum Wage Commission meeting room in the Government Sejong Complex, Sejong City. (Image source=Yonhap News)
[Sejong=Asia Economy Reporter Moon Chaeseok] As negotiations for next year's minimum wage have begun, significant disagreements between labor and management over Article 1 of the Minimum Wage Act have emerged. The employer side argues, "We must fully consider the reality that businesses paying minimum wage have been hit hard by COVID-19," while the worker side states, "The purpose of the law is to improve workers' labor standards, not to protect employers' interests, so support for employers should not be considered."
Rather than progressing, discussions between labor and management are only widening the divide, with fundamental differences in basic assumptions. In particular, there is a clear difference in perspectives regarding Article 1, which outlines the purpose of the Minimum Wage Act. Article 1 states that "The purpose is to contribute to the sound development of the national economy by guaranteeing the minimum level of wages for workers, thereby ensuring workers' livelihood stability and improving the quality of labor."
According to multiple labor and management members of the Minimum Wage Commission, fierce debates are expected over how much the economic impact on employers due to the COVID-19 crisis should be reflected in decision-making. The employer side says, "Employers have suffered significant damage from COVID-19, so how can the minimum wage be raised drastically?" Meanwhile, the worker side argues, "The purpose of the Minimum Wage Act is to help vulnerable workers who are likely to be marginalized in the labor market by improving their labor quality and livelihood stability, so why should decisions be employer-centered?"
In fact, one hour before the second meeting, four worker representatives from the Korean Confederation of Trade Unions (KCTU) did not even attend the meeting. Instead, they held a rally outside the venue demanding a substantial increase in the minimum wage. The message from Employment and Labor Minister Ahn Kyung-deok, asking to "make efforts to determine a reasonable minimum wage," was ignored.
The gap between labor and management perspectives is widening. Since the first meeting on the 20th of last month, the debate has proceeded in the order of 'current minimum wage level → scale of retention of public interest commissioners → impact of minimum wage on self-employed damage.' To achieve the "10,000 won" goal, which is presented as a negotiation target by the worker side due to it being a policy task of the Moon Jae-in administration, the minimum wage must be raised by 14.7% from this year's 8,720 won.
The government's mediation efforts are not effective. The government influences the appointment of the 30 Minimum Wage Commission members and also sends three special commissioners. While respecting the commissioners' autonomous decision-making, the commission's principle is that the final announcement should be made with a unified voice. Although it is preferable for the government not to publicly state its position to align with the purpose, many believe it should not neglect its duties such as appointing public interest commissioners and mediating inside and outside the meeting venue.
The government has issued a general message that "full-scale consultations will begin next month." After receiving the review results from the Minimum Wage Commission's specialized committee, substantive discussions are expected to start from the third plenary meeting on the 15th of next month. Since the deadline for announcing the minimum wage is August 5, a conclusion must be reached by mid-July at the latest to meet the legal deadline. It is rare for labor and management members, who have engaged in fierce debates every year, to meet the legal deadline.
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