[Exclusive] 1,633 Violations of Minimum Wage Law Last Year... Daegu and Gyeongbuk 'Most Cases'

Daegyeong Region, Dongnam Region, Honam and Jeju Regions in Order
Many Violations in Small Businesses like Convenience Stores and Restaurants
Ministry of Employment Refuses to Disclose Convenience Store Statistics

As formal discussions on next year's minimum wage begin, it has been revealed that there were over 1,600 reported cases of minimum wage law violations last year. In particular, the number of minimum wage violations per capita by region was highest in the Daegyeong area (Daegu and Gyeongbuk).

According to data on minimum wage violation cases submitted by the Ministry of Employment and Labor to Lee Su-jin, a member of the National Assembly's Environment and Labor Committee from the Democratic Party of Korea, the number of reported minimum wage law violations last year was 1,631 cases, with 1,897 cases processed. The number of processed cases includes cases carried over from reports filed in the previous year. The annual number of reported (processed) minimum wage law violation cases was 2,000 (2,425) in 2018, 2,336 (2,840) in 2019, 2,293 (2,901) in 2020, and 1,852 (2,233) in 2021.

Looking at last year's minimum wage violation cases by region, the simple number of reports was highest in the Seoul Metropolitan Area (Seoul, Gyeonggi, Incheon) with 743 cases. This was followed by Daegyeong area with 302 cases, Dongnam area (Busan, Ulsan, Gyeongnam) with 275 cases, Honam and Jeju area (Gwangju, Jeonbuk, Jeonnam, Jeju) with 172 cases, Chungcheong area (Sejong, Daejeon, Chungbuk, Chungnam) with 100 cases, and Gangwon area with 39 cases. However, when these figures are adjusted for regional population, the order from highest to lowest was Daegyeong area, Dongnam area, Honam and Jeju area, Seoul Metropolitan Area, Gangwon area, and Chungcheong area. As of December last year, the population of the Seoul Metropolitan Area was 25,985,118, Dongnam area 7,708,968, Honam and Jeju area 5,696,513, Chungcheong area 5,547,758, Daegyeong area 4,964,168, and Gangwon area 1,536,498.

Examining violations by specific articles of the Minimum Wage Act, violations of Article 6 accounted for 1,854 cases, making up the majority. This article stipulates that employers must pay workers subject to the minimum wage at least the minimum wage amount and must not reduce previous wage levels due to the minimum wage law. Regarding the types of measures taken, about half of the 1,897 cases processed last year, totaling 1,001 cases, were administratively closed. These cases involved the restoration of workers' rights, such as payment of wages above the minimum wage during the investigation process. 890 cases were subject to judicial action, leading to prosecutions, and 6 cases resulted in fines.

By workplace size, those with fewer than 5 employees ranked first with 917 cases (1,030 processed cases). Workplaces with 5 to fewer than 50 employees had 433 cases (538 processed), those with 50 to fewer than 300 employees had 180 cases (221 processed), those with 300 or more employees had 29 cases (30 processed), and 72 cases (78 processed) had no input on size. It is understood that violations of the Minimum Wage Act frequently occur in small-scale businesses operated by small business owners, such as convenience stores, restaurants, and pubs.

Customers are purchasing lunch boxes at a convenience store in Seoul.

In particular, to analyze the actual situation of minimum wage violations in convenience stores operated by large distribution companies, Lee's office requested data from the government. However, the Ministry of Employment and Labor refused to provide a response, stating that it does not separately extract violation cases for convenience stores. Asia Economy filed information disclosure requests with the Ministry of Employment and Labor and local employment and labor offices but received notifications of non-existence of information. Upon appeal, an administrative trial was filed to enforce information disclosure, but the Central Administrative Appeals Commission ultimately dismissed the case.

The Ministry of Employment and Labor conducts crackdowns on minimum wage violations through regular inspections, occasional inspections, and special inspections, but the number of reported cases has averaged 2,022 annually over the past five years. Convenience store headquarters maintain that they must comply with the legally mandated minimum wage, but they only inform franchisees of the changed minimum wage. In fact, they take a passive stance with no significant measures regarding stores violating the Minimum Wage Act.

Assembly member Lee emphasized, "Although the purpose of the minimum wage system is to ensure workers' livelihood stability and improve the quality of labor, the Ministry of Employment and Labor has not properly guided or supported small businesses to establish the system, so the damage is directly borne by the workers," adding, "The government must devise coexistence measures for small business owners and workers to resolve inequality and polarization."