Gov't launches advisory body to improve minimum wage system

Labor groups express worries over intentions behind ‘suspicious’ move

By Jung Min-ho

The government on Friday launched an advisory group to improve the minimum wage system — a move that raises labor activists' suspicions because of its lack of representation from the labor side.

According to ministry officials, the group consists of nine incumbent and former members of the Minimum Wage Commission, all of whom are scholars on labor issues, and is tasked with finding “reasonable ways” through talks to improve the current system.

“Instead of finding reasonable common ground, wasteful strife tends to be repeated every year at today’s Minimum Wage Commission,” Employment and Labor Minister Kim Moon-soo said. “I hope the group would find ways for fundamental reforms that could embrace changes in the labor market … I hope they would listen to those working in various industries and come up with ways that could resonate with the public.”

Asked about the specific objectives of forming the group, a ministry representative told The Korea Times that there was none.

“The group was not launched to achieve any specific goals. If there is any issue that needs to be discussed, the members would address it, whatever it might be,” the official said. “They are expected to discuss issues that workers and employers have raised in recent years. After about two months, they will submit suggestions for improvements. Based on that, the ministry will push for legislation.”

Established in 1987, the commission has been responsible for setting the nation’s minimum wage each year. It is composed of three groups, each with nine members representing employers, workers and the public sector, with public sector members consisting of professors and researchers. Due to this structure, employer and worker representatives often struggle to reach a consensus on the rate of minimum wage increases, leaving public sector representatives — often influenced by the incumbent administration — to propose arbitration plans.

There have been voices calling for system reforms over the past few years, especially from small business owners struggling with “excessive” minimum wage hikes. Another issue that drew extensive attention was growing calls to introduce a separate minimum wage system for foreign workers.

Those issues could be included in the group’s agenda. But structural reforms will be difficult without the agreement of the opposition Democratic Party of Korea, which holds a majority in the National Assembly.

“After more than 30 years, there have been questions over whether we need to change the system,” the ministry official said.

Yet labor activists doubt the advisory group will make any changes in their favor. The same day, the nation’s two largest umbrella labor unions — the Federation of Korean Trade Unions (FKTU) and the Korean Confederation of Trade Unions (KCTU) — expressed concerns over the move.

“We express strong regret over the ministry’s decision to unilaterally form an advisory body without seeking agreement from labor groups in advance,” the FKTU said in a statement. “It is also regrettable that it consists of incumbent and former members of the Minimum Wage Commission. In the past, some of them ignored the criteria stipulated by the minimum wage law in determining the minimum wage level and used arbitrary methods to press ahead with setting the wage at a lower rate than the rate of inflation.”

The KCTU agreed, saying the group’s proposals will be rejected by labor organizations.

“Based on the group’s composition, (the ministry’s) intentions are obvious,” the KCTU said in a statement. “The results of the group’s efforts, expected to be announced by the end of this year, will be just wasted.”