28/07/2016
News from Korea Times.
KOREA 2017 MINIMUM WAGE INCREASE
Minimum wage may rise to W6,500 in 2017
음성듣기
By Chung Hyun-chae
Next year’s minimum wage is likely to be set at 6,500 won ($5.74) an hour, a 7.7 percent increase on this year.
Representatives of employers and employees will announce the result of their talks today after holding a Minimum Wage Council meeting at the Government Complex in Sejong City on Friday.
Third-party council members representing the public proposed a minimum wage of 6,253 won to 6,838 won as a compromise on July 12.
The proposal came as representatives of both sides failed to narrow their differences on the wage rise during lengthy negotiations.
Employers insisted on a freeze, citing financial difficulties. Workers have demanded the minimum wage be increased to over 10,000 won.
Sources said there is a high possibility the two sides may agree to the compromise deal to increase the wage by around 7.7 percent.
This year's minimum is 6,030 won an hour. If a person works eight hours a day, five days a week, his or her monthly minimum salary is 1.26 million won.
If the minimum wage is raised to 6,500, as expected, a worker’s monthly salary will rise to about 1.35 million won.
The third-party council members are entitled to propose the lower and upper limits of a wage hike when employers and employees cannot agree.
In light of last year’s case, it is highly possible the minimum wage will be set at the median of 6,545 won, a third-party council member said.
In 2015, the third-party members proposed a wage rise between 5,940 won and 6,120 won after the negotiations broke down, and finally the wage was set at 6,030 won.
But some negotiators representing small businesses have kept a hard-line stance, saying they cannot accept even a 3.7 percent increase, which is the lower limit.
“Considering that economic growth is around 2 percent and inflation remains around 1 percent, a 3.7 percent increase in the minimum wage is kind of burying our head in the sand,” a council member representing small businesses said.
Meanwhile, labor rights advocates argue a higher wage rise is necessary to resolve the nation’s widening income disparity and improve the living standards of low-income workers.
Since the government introduced the minimum wage in 1988, the Minimum Wage Council ― nine members each from labor, management and the public ― has set the minimum wage through a vote.
The wage goes into effect if it is approved by a majority vote, based on more than half of members attending.
The regulation calls on the minister of employment and labor to declare next year’s minimum wage by Aug. 5. And the council is required to set the wage at least 20 days earlier because the minister’s declaration needs government approval. This virtually sets the deadline around July 16.
