Choi says regular workers a burden
“Regular workers are overprotected,” said Choi at a press conference in Cheonan on Tuesday. “Companies are not able to hire more because of the burden of paying them. The labor market must be restructured.”
Companies are struggling to afford labor costs as the number of regular employees rises along with wages, he explained.
“Once a regular employee is hired, the company should guarantee the legal retirement age of 60, while the government-led peak wage system isn’t working effectively,” Choi said.
Earlier, the minister mentioned structural reform would be a key part of the economic policy next year, implying the government is preparing for some radical moves.
“The government will discuss various measures, including a shift in the current seniority-based wage system to some extent that employees will also agree upon,” the minister said.
Statistics Korea estimated the total number of regular employees was 13 million as of August and irregular workers numbered six million.
The average monthly wage for regular workers stood at 2.6 million won ($2,350) and for irregular workers at 1.5 million won. For regular employees, companies must pay half the cost of social insurance programs.
“One of the difficulties for companies is they can’t fire regular workers,” said an official at the Economic and Social Development Commission. “But making it easier for companies to dismiss regular employees is impossible, especially in a country where the social safety net is poor. The government’s focus will be on revamping the wage system.”
The nation’s labor unions reacted with strong opposition to Choi’s comments.
“The minister’s thought that companies are not hiring more regular workers because they’re not able to fire them is totally wrong in the first place,” said Lee Jung-sik, a member of the Federation of Korean Trade Unions.
“Revising the wage system is not the business of the government. It should be between labor and management at each company.”
BY SONG SU-HYUN [firstname.lastname@example.org]