Parliament Passes Revision to Minimum Wage Bill open the window of AOD

Write : 2018-06-03


The National Assembly on Monday passed a revision bill on the minimum wage that will incorporate some regular bonuses and welfare allowances into the minimum wage.
One-hundred-60 out of 198 lawmakers in attendance voted for the bill, while 24 voted against and 14 others abstained.
Under the bill, regular bonuses exceeding 25 percent of minimum wage and welfare benefits such as those for lodging and transportation surpassing seven percent of the minimum wage will be included in the calculation of minimum wages.
The bill considers these regular payments as part of the minimum wage.
The partial revision is intended to ease the burden of employers following the steep hike in the hourly minimum wage to seven-thousand-530 won from this year.
The bill is also to address unreasonable aspects that arise from Korea's unique payment system where bonuses tend to account for more than the basic wage.
For instance, in industries where hefty bonuses are paid out, workers will benefit from a higher minimum wage although they already receive a relatively high income.
The parliament and government say the revision will have no impact on workers earning less than 25 million won a year. But labor circles argue three out of ten workers earning below 25 million will be affected by the change.
Labor groups have opposed the bill, calling it a step backwards because it undermines the effectiveness of the 16-point-four percent minimum wage hike.
Labor unions plan to launch a general strike to protest the revision.
Meanwhile, one umbrella union, the Federation of Korean Trade Unions, has urged President Moon Jae-in to exercise his right to veto the revised bill.
It also withdrew its five councilors from the Minimum Wage Commission, which is a tripartite mediating body comprised of management, union and government representatives.
Another umbrella union, the Korean Confederation of Trade Unions(KCTU), previously announced its decision not to take part in the commission. The KCTU also launched a protest rally against the legislation in front of the presidential office on Friday.
Due to labor’s boycott of the trilateral dialogue, it will likely be difficult to determine next year's minimum wage by the legal deadline of June 29.
The aftermath of the bill’s passage is also felt among lawmakers who had rejected the revision, including the Justice Party which has urged President Moon to veto the bill.

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