Working toward mutual benefitsThe Ministry of Employment and Labor announced a new set of advisory guidelines on management and labor issues incorporating last month’s Supreme Court ruling that included regular bonuses in base salaries. The government’s administrative order, held since 1988, which separated regular bonuses and allowances from base salaries, was challenged by the Supreme Court. It eventually ruled in favor of workers.
But the new guidelines won’t likely help in easing the confusion and conflict between employers and workers over how base salaries are calculated. The government proposes that bonuses - paid out to regular workers in intervals of more than a month - should be counted in base salaries. But special bonuses or allowances given out to employees working at the time are not counted as fixed earnings, according to new guidelines.
The ministry said that the guidelines incorporated the Dec. 18 Supreme Court ruling. The court said it could turn down retroactive applications from workers demanding unpaid past dues because of an extension in the scope of what a base salary is if companies can prove that doing so would seriously threaten their finances.
Labor groups protest that the government guidelines incorporating the highest court ruling remain too favorable for employers. Employers are also unhappy about the elimination of one-month gap guidelines differentiating bonuses and base salaries. Labor and management will likely clash over interpreting permanent working terms and retroactive applications.
The government came up with the guidelines only after the Supreme Court ruling. But they are strictly guidelines, not rules. How they are applied in workplaces depends on the will of employers and workers. Both sides should negotiate for a deal that could serve both the workers and companies well. They must talk freely and sincerely on corporate finance state and affordability to find a reasonable salary base.
The government should also take procedures to legalize the base of wages and other working terms to end conflict over salaries. Kim Dae-hwan, chairman of the Economic and Social Development Commission, said that the government will try to draw a grand compromise on employment and labor issues within the year.
Labor union representatives should return to the tripartite commission and help to generate a consensus on a new salary structure.