Wage Confrontation
Korea Employers Federation Vice Chairman Kim Yeong-bae said on March 26 that the salary of full-time workers earning more than 60 million won (US$54,328) a year should not be raised for five years to come. The money saved by doing so should be spent on employee welfare at subcontractors and job creation.
He added that the specific figure of 60 million won is equivalent to 1.5 times the average annual salary of ordinary workers, and those with that or higher income are considered better-off in general.
“The domestic labor market has to have a higher level of flexibility, and employees not suitable for certain work should be let go,” he mentioned, continuing, “Then, companies will be able to manage their manpower more effectively.”
His remarks are regarded as an objection to the government’s plan to increase overall wages. Deputy Prime Minister Choi Kyung-hwan has stressed, since the second half of last year, the importance of a recovery in consumption and domestic market revitalization based on wage increases and the subsequent household income increase.
In the meantime, the Korean Confederation of Trade Unions recently demanded that the legal minimum wage for next year be increased 79.2 percent from this year to 10,000 won (US$9.05). It is highly likely that labor groups will be firmly opposed to the Korea Employers Federation when it comes to wage issues.
The Minimum Wage Committee, consisting of nine employee representatives, nine employer representatives, and nine members of the government, is scheduled to hold its first plenary session late next month.