Labor calls for 12,000 won; management demands freeze at current 10,320 won

First revised proposals due at 10th plenary session on Tuesday

Employer and worker representatives listen with tense expressions during the ninth plenary session of the Minimum Wage Commission at the Government Sejong Complex on Thursday. [Yonhap]
Employer and worker representatives listen with tense expressions during the ninth plenary session of the Minimum Wage Commission at the Government Sejong Complex on Thursday. [Yonhap]

Labor and management clashed sharply over next year's minimum wage.

At the Minimum Wage Commission's ninth plenary session held Thursday at the Government Sejong Complex, representatives from both sides defended the initial proposals they had each put forward at the June 23 session. Worker representatives called for a 16.3 percent increase to 12,000 won from the current 10,320 won, while employer representatives demanded a freeze at 10,320 won.

Worker-side commissioners cited the cost-of-living burden on low-wage workers as the primary reason for an increase. Ryu Ki-seop, secretary-general of the Federation of Korean Trade Unions, said the employer side had called for a freeze or cut every year for more than two decades, going back to 2007 when the minimum wage stood at 3,480 won. "It is hard to see even the will or attitude to look at the lives of low-wage and vulnerable workers," he said.

Ryu added that, accounting for inflation, the actual living cost for an unmarried single worker this year comes to 2.82 million won per month, leaving a gap of 670,000 won compared with the monthly wage of 2.15 million won based on the current minimum wage.

Employer-side commissioners, by contrast, argued for a freeze, saying small and medium-sized enterprises and small business owners are being pushed to the brink amid high oil prices, high inflation and a high exchange rate.

Ryu Ki-jung, executive managing director of the Korea Employers Federation, said 56.8 percent of small and medium-sized enterprises last year failed to cover even their interest expenses with operating profit, and that outstanding loans held by the self-employed reached a record 1,095.5 trillion won as of the end of the first quarter this year. "A high minimum wage is clearly a major cause of hardship for small business owners," he added. "If the minimum wage burden grows further, small and medium-sized enterprises and small business owners will inevitably be driven into a management crisis they can no longer survive."

The two sides remained deadlocked even after the session moved into closed session, with worker representatives continuing to push for an increase and employer representatives holding firm on a freeze. The Federation of Korean Trade Unions also held a rally outside the Ministry of Employment and Labor building, where the commission meeting was taking place, calling for a minimum wage increase.

Both sides are set to present their first revised proposals at the opening of the 10th plenary session on Tuesday.


siuu@heraldcorp.com