Weak yen galvanizes Japanese market

Vice chairmen of five business lobby organizations held an emergency meeting yesterday to urge politicians and the government to stop creating an anti-business atmosphere by enacting several regulations against companies.

“The political circle should withdraw excessive legislation that does not take into account the reality of our economy and business environment,” they said.

Organizations represented were the Federation of Korean Industries, Korea Chamber of Commerce & Industry, Korea International Trade Association, Korea Federation of Small and Medium Business and Korea Employers Federation.

The vice chairmen were not opposed to a bill raising the retirement age to 60, but want follow-up measures, saying companies would find it difficult to hire young workers.

If the retirement age extension is passed, one of the biggest issues will be adjusting wages, the representatives pointed out.

Politicians are considering a salary peak system to lessen the financial burden on companies. An employer would offer a lower wage to a worker after a certain age in return for guaranteed employment to age 60.

On Tuesday, members of the legislative subcommittee of the National Assembly’s Environment and Labor Committee passed a bill that says businesses that employ more than 300 workers and state-run enterprises must adopt a retirement age of 60 starting Jan. 1, 2016. Smaller companies and central and local governments will introduce the new retirement age by Jan. 1, 2017.

Another bill to include fixed incentives to regular salaries would incur astronomical costs of as much as 38 trillion won, the businessmen argued.

More and more companies complain these days that their trade unions are demanding planned bonuses added to their annual salaries after the Supreme Court ruled in a case last year that a salary should include bonuses.

They also pointed to legalizing substitute holidays as excess legislation.

“There is no precedent for this system in any country, and it could take a toll on temporary workers and self-employed people as they are forced to work less and earn less,” they argued.

As for the introduction of a system to give incentive points to mothers when they apply for jobs, the vice chairmen said it is unfair to other applicants, especially men.

“We are worried that these populist bills could undermine the growth engine of our economy and hinder social integration,” the representatives said.

By Song Su-hyun [ssh@joongang.co.kr]