Minimum Wage Commission's 4th plenary session takes up gig and platform workers

Labor side says time to decide how to apply coverage; business side says it falls outside commission's authority

Ryu Ki-jung, executive managing director of the Korea Employers Federation and an employer representative on the Minimum Wage Commission, speaks at the commission's 4th plenary session held Tuesday at the Government Sejong Complex. [Yonhap]
Ryu Ki-jung, executive managing director of the Korea Employers Federation and an employer representative on the Minimum Wage Commission, speaks at the commission's 4th plenary session held Tuesday at the Government Sejong Complex. [Yonhap]

Worker and employer representatives on the Minimum Wage Commission clashed Tuesday over whether contract-based workers should be covered by the minimum wage, as the panel convened to set next year's rate.

The commission held its 4th plenary session at the Government Sejong Complex, continuing discussions on extending minimum wage coverage to workers in special employment and platform arrangements — including delivery riders, designated drivers and private tutors. Twenty-six of the commission's 27 members attended, meeting quorum, with nine worker representatives, nine employer representatives and eight public-interest members present.

Employer representatives argued that workers in special employment categories are legally classified as self-employed individuals, not employees, and therefore fall outside the scope of minimum wage law. Labor representatives pushed back, citing a special provision in the Minimum Wage Act covering contract-based work, and called on the commission to develop a concrete framework for applying the minimum wage to such workers.

Ryu Ki-jung, executive managing director of the Korea Employers Federation, said workers in special employment arrangements "are self-employed individuals, like sole proprietors, except for the very small number whose employee status has been recognized by a court." He added that the commission "has no authority to make a final determination on employee status, and setting a separate minimum wage standard for workers whose coverage eligibility has not been confirmed is not within the committee's mandate or role."

He went on to say that calling for minimum wage coverage for special employment workers who have not been recognized as employees "could be seen as an argument to selectively enjoy the benefits of both business owner and employee status." He added that "what is needed now is policy consideration for small business owners and the self-employed who are being pushed to the brink."

Yang Ok-seok, head of the human resources policy division at the Korea Federation of SMEs, said contract agreements "are contracts in which payment is made on condition of completing a task," and that "no country in the world treats contract agreements under minimum wage law." He said protections for parties with weak bargaining power have developed "not through minimum wage mechanisms but through fair contract arrangements that guarantee appropriate compensation."

He warned that "forcing minimum wage rules onto contract arrangements could cause disruption to the retail and distribution systems of neighborhood businesses, small enterprises and small business owners that rely on platform and contract structures," and said it "could ultimately lead to an exodus of contract workers and a reduction in jobs."

Labor representatives, by contrast, said expanding minimum wage coverage was essential to protect workers in special employment and platform arrangements.

Ryu Ki-seop, secretary-general of the Federation of Korean Trade Unions, said the previous session had confirmed "that introducing a minimum wage for contract workers is fully achievable within existing law and the current system." He said the commission's task now "is not to re-examine whether these workers qualify as employees, but to decide how the minimum wage will be applied."

He went on to say that minimum wage guarantee systems for delivery riders in New York and Seattle, the United Kingdom's fair unit-rate regime, and South Korea's own safe freight rate system for truckers "show that a separate minimum wage calculation method suited to contract work is possible." He said such measures "have brought positive effects including higher labor productivity, improved safety and lower turnover rates."

Lee Mi-seon, vice chairwoman of the Korean Confederation of Trade Unions, described an ongoing sit-in protest outside the National Assembly demanding minimum wage coverage for special employment and platform workers. She said delivery riders, designated drivers and private tutors "are suffering from unpaid labor due to waiting time, travel time and canceled orders."

She went on to say that "we must not forget the reality that one in five workers killed in industrial accidents is a special employment worker in the delivery or service sector," adding that "low commission rates and excessive competition are increasing the risk of workplace accidents. Minimum wage coverage is the minimum safety net needed to protect these workers."

Seong Jae-min, acting president of the Korea Labor Institute and secretary of the commission's public-interest members, said the session had confirmed that the issue "is not a simple one, requiring a comprehensive look at a wide range of disputes and on-the-ground conditions." He said he hoped Tuesday's meeting would allow members to "discuss the issues raised in previous sessions more deeply and take sufficient time to listen to each other's views and concerns."


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