KCCI asks quick action on bonus as wages issue

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KCCI asks quick action on bonus as wages issue

The leadership of the Korea Chamber of Commerce and Industry submitted letters to the National Assembly, Park Geun-hye administration and Supreme Court urging them to quickly resolve the contentious issue of whether bonuses should be included in ordinary wages.

The KCCI said that, as of at the end of May, 135 lawsuits had been filed against companies hiring 100 employees or more, demanding that regular bonuses be calculated as part of an employee’s monthly wages.

It’s important for employers to have a clear definition of monthly wages because they are used as a basis for calculating overtime, severance and retirement payments.

“Recently, labor groups representing employees have expressed positions that they will actively engage in class-action suits against companies,” the letter said.

The KCCI said ordinary wages have been determined based on mutual agreement of labor and management.

“Given that adding a new salary category or deciding a wage hike rate was determined through the two parties’ negotiations reflecting employees’ job contributions and companies’ ability to pay [employees], filing a lawsuit against ordinary wages denies the foundation of the labor-management agreement and also goes against the faith between the labor and management,” the KCCI said.

The KCCI leadership, including Chairman Sohn Kyung-shik, has requested the National Assembly create an article that recognizes existing ordinary salaries, which was agreed upon by labor and management. It asked lawmakers to add clear regulations in regard to ordinary wages.

The leadership also urged courts to hand down reasonable and fair rulings, in consideration of potential future economic consequences.

The controversy began in March 2012, when the Supreme Court ruled in favor of a bus company’s workers, saying that regular bonuses and long-service allowances should be calculated as part of monthly wages.

BY KIM MI-JU [mijukim@joongang.co.kr]
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