Park Jun-sung, left, chairman of the Minimum Wage Council, shakes hands with an unidentified negotiator at the council's headquarters in Seoul, Friday. / Yonhap
By Kim Se-jeong
The minimum wage will rise 7.2 percent to 5,210 won ($4.57) per hour next year.
The Minimum Wage Council reached a deal on the increase Friday in a 15-1 vote with nine abstentions.
This latest move means an employee can earn at least 1.08 million won in monthly wages with a 40-hour workweek.
"The increase is expected to benefit nearly 2.56 million workers in the lowest income bracket," Chun Hae-seon from the council told The Korea Times.
Friday's deal failed to meet an initial June 27 deadline. Next week, the Ministry of Employment and Labor will give its approval too.
However, labor unions are dissatisfied with the deal. "We call for at least a double-digit increase," a member of the Korean Confederation of Trade Unions said.
A staffer of the Korea Employers Federation also described the result as unfortunate. "The 7.2-percent increase will bring a burden on small business owners, especially ones with less than 30 employees."
The minimum wage negotiation is done annually with a history of clashes among the three parties involved. The council arbitrates between parties representing employees and employers.
During this year's negotiations, the party representing the employees' interest demanded a 21.6-percent increase to 5,901 won, while employers insisted the rate be frozen, dragging the process as a result.
The council does its own calculation taking into account workers' living costs and average wages, the national economic growth rate, inflation rate and income distribution rate.
The raise still invites a question: Is this enough?
That has been at the heart of debates on minimum wage for so long.
The labor unions believe the amount is far from being enough, calling on the government to push for a meaningful raise that will be enough to support an entire household. The other party has generally been opposed to an increase.
Minimum wage negotiations in Korea began in 1988, two years after the Minimum Wage Act was enacted.
Back then, the minimum wage was 462.5 won per hour.