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Minimum-wage committee structure drafted

Jan 08,2019
The Ministry of Employment and Labor on Monday released its draft proposal for a new structure to be used in arriving at minimum wage levels. A final version is expected to be announced later this month after a public hearing is held and responses from labor and business are considered.

According to the draft, a committee of nine experts will recommend a minimum wage increase range considering various factors, including the economic situation and the impact the increase would have on the economy. Another committee will finalize the recommendation for the following year’s increase.

“Since the factors that will decide the minimum-wage increase range will be based on objective data, the process will be more rational than in the past, where the labor union and business have been engaged in a tug of wars on their demands,” said Employment and Labor Minister Lee Jae-kap.

The minister said these changes will help minimize time-wasting squabbles and put an end to the suggestion that the government has too much influence in the minimum wage decision-making process.

If the draft is finalized, it will be the first time the structure has been altered in 30 years. The new system will be utilized in arriving at 2020’s minimum wage rate.

In terms of the actual makeup of the committees, the Labor Ministry has provided two options.

In the first, labor, business and the government will each propose five experts, though extreme members will be eliminated, leaving nine. The goal is to achieve a more middle-of-the-road membership.

Another proposal involves each group nominating three experts.

The committee that will make the final decision will take a similar form to the existing minimum wage committee but with a reduced membership. Currently, each constituency sends nine members, bringing the total number of members to 27. One proposal has the total membership being reduced to 21. Another takes the total down to 15.

Government representation will also be changed. In the case where seven members are sent to the committee, the National Assembly will propose three candidates while the government will propose four. Another process suggested is for labor, business and the government to propose a total of 15 people and then reduce the number to seven.

The ministry said that the government will no longer cast the deciding vote. This is to prevent criticism that it has too much influence in the process.

When discussions have come to a standstill, the figure chosen by the government group has usually been accepted. This has been how minimum wage has been decided over the past decade.

Since many members representing the government are inclined toward the sentiments of the administration, there were complaints that the government has had too much influence in deciding the minimum wage.

Another major change is to be more inclusive in terms of members. More young people and women are to be appointed, as well as those representing SMEs and contract workers.


BY LEE HO-JEONG [lee.hojeong@joongang.co.kr]


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