To save jobs, guards will get paid less

To save tens of thousands of jobs for the elderly from potentially being eliminated, the Ministry of Employment and Labor said yesterday that it would extend the minimum wage exemption for apartment security guards for another three years.

Under a 2007 revision of the country’s minimum wage, apartment security guards were to begin receiving 100 percent of the minimum wage - 4,580 won ($4) per hour next year - starting next year after a five-year grace period during which they were paid 70 to 80 percent of the legal minimum.

But due to fears of mass layoffs and the replacement of guards with security cameras and automatic doors at many apartments, the ministry said that apartment security guards, or gyeongbi in Korean, would instead be paid 90 percent of the minimum wage starting next year until 2015.

The 2007 revision, spearheaded by the Lee Myung-bak administration, had been an effort to ensure that all paid workers received 100 percent of the minimum wage. But the prospect of a sudden pay raise for security guards next year had apartment residents clinging to their wallets.

Guards’ salaries usually come from monthly maintenance fees that are paid by apartment residents, many of whom say that they are already burdened by increasing living expenses in a weak economy.

The ministry, for its part, came under criticism for not thinking through the consequences of mandating full minimum wage for security guards - 87 percent of whom are over 60 years old and whose jobs are a critical source of income for hundreds of thousands in a country with no comprehensive social security program.

The extended exemption, the ministry said, was expected to reduce the number of layoffs from 36,000 to 17,000 out of 300,000 officially registered security guards nationwide, though that figure could be as high as 400,000.

With security guards now set to receive 90 percent of the legal minimum instead of 100 percent, the ministry said the average monthly salary would decrease from 1.53 million won to 1.38 million won.

In addition to the three-year exemption, the ministry announced that it would also provide subsidies to businesses that hire people over the age of 60 and institute reform measures such as requiring mandatory breaks. Most apartment security guards currently work 24-hour shifts at a time with no break.

“Security guards should receive more than 100 percent of the minimum wage in principle, but we inevitably had to apply only 90 percent starting next year to keep older workers in the market,” said Minister of Employment and Labor Lee Chae-pil.

In a study commissioned by the ministry, Professor Kim Dong-bae of Incheon University found that the number of security guard jobs decreased by 7.7 percent since 2007 while the number of CCTV cameras installed in apartment complexes increased by 35.1 percent in the same period.

Had the exemption not been extended, the ministry said that the average wage for security guards would have risen 32.5 percent starting next year, making mass layoffs likely.

In a ministry survey of 1,234 apartment complexes with more than 150 households, apartments said they planned to reduce the number of security guards by an average of 12 percent if they had to pay 100 percent of the minimum wage from next year. Paying security guards 90 percent of the minimum, meanwhile, decreased the figure to 5.6 percent.

“We asked for opinions from both management and labor and found that both parties wanted the wage to increase in stages,” a ministry official said.

By Yim Seung-hye [sharon@joongang.co.kr]