Minimum Wage in South Korea Increased by 5% to US$7.41 in the Coming Year

Published on: 30 June 2022
by KnowESG
tinywow webp to jpg 3163359

According to officials, representatives from South Korea's labour and management have agreed to establish the minimum hourly wage for next year at 9,620 won (US$7.41), a 5% rise over this year.

The agreement was reached Wednesday night during a plenary session conducted at the government complex in Sejong by the Minimum Wage Commission, which comprises nine members representing labour, business, and the general public.

The new rate equals a monthly wage of 2.02 million won. It will apply to all businesses.

During the negotiations, the labour side demanded a large rise from this year's 9,160 won, claiming that the previous Moon Jae-in administration's vow to raise the minimum hourly wage to 10,000 won had not been fulfilled.

The labour side proposed setting the minimum hourly pay for next year at 10,090 won, a 10% increase over this year.

Meanwhile, the management side had requested a 1.86 per cent year-on-year rise, citing the economic damage caused by the COVID-19 outbreak, as well as the high-interest rate, inflation, and exchange rate, according to reports.

After the labour and business commissioners failed to reach an agreement, the commissioners representing the public interests recommended the final amount, which was confirmed by a 12-1 vote.

Before the vote, all nine commissioners from the general public departed the room. Before the vote, four of the nine labour commissioners proposed by the Korean Confederation of Trade Unions departed the room in protest of the plan.

The commission is required by law to deliver the new minimum wage to the labour minister, who must make it public by August 5.

Both parties may protest the agreement and, with the minister's approval, request that the commission reevaluate it. However, no reevaluation has occurred since the introduction of the minimum wage regime in 1988. The higher wage will go into effect on January 1, 2023.

Source: The Sun Daily

For more social and governance news

Share:
esg
esg
esg
esg