Due to Grim Economic Outlook,
"Upper Limit of Facilitation Range Set Low"
With next year's minimum wage being set through a labor-management-public agreement for the first time in 17 years, Lee Injae, chairman of the Minimum Wage Commission, stated that this outcome "demonstrates our society's capacity to coordinate differences and resolve conflicts through social dialogue."
Chairman Lee made this assessment regarding the minimum wage decision after the 12th plenary session of the Minimum Wage Commission held at the Government Sejong Complex on the 10th.
Lee Injae, the chairman of the Minimum Wage Commission, is answering reporters' questions after the 12th plenary session held at the Government Sejong Complex on the 10th, where next year's minimum wage was decided to be 10,320 won per hour. Photo by Yonhap News
On this day, the Commission decided to raise next year's minimum wage to 10,320 won, a 2.9% increase from this year's 10,030 won, through an agreement among worker, employer, and public interest members. It is the first time in 17 years, since 2008 (for the 2009 minimum wage), that the minimum wage has been determined by a labor-management-public consensus.
However, the Korean Confederation of Trade Unions (KCTU) refused to participate in the deliberation and walked out during the meeting, leaving only the Federation of Korean Trade Unions (FKTU) to take part in the agreement process. Excluding the four KCTU members, the agreement was reached by a total of 23 members: five worker representatives, nine employer representatives, and nine public interest representatives.
The KCTU demanded a revision, arguing that the deliberation facilitation range was too low, but when this was not accepted, they left the meeting. Previously, the public interest members had proposed a facilitation range between 10,210 won (lower limit) and 10,440 won (upper limit).
Chairman Lee explained, "This year, the economic growth rate is projected at 0.8%, the consumer price inflation rate at 1.8%, and the employment growth rate at 0.4%, all of which are low." He further stated, "Taking all these factors into account, we judged that the economic situation is worse this year than last year, and will be even worse next year, which is why the upper limit of the facilitation range was set low."
However, when asked whether the current economic crisis is as severe as the IMF foreign exchange crisis, he responded, "That is an over-interpretation," and added, "Since this increase rate was determined by agreement, I would like it to be viewed not through logical analysis, but from the perspective that labor and management made mutual concessions to reach the final conclusion."
Kwon Soonwon, professor at Sookmyung Women's University and secretary of the public interest members, said, "Although only the five FKTU representatives remained among the worker members, it would be good to understand that the agreement also reflects the concerns and arguments raised by the KCTU members who left."
He also mentioned, "The unified opinion among the public interest members was to use this social agreement at the Commission as a starting point for national integration," and added, "The willingness to persevere to the end, persuade both labor and management, and ultimately reach an agreement is what made today's consensus possible."
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