By Jun Ji-hye
The two Koreas are heading for a conflict over wages at their joint industrial complex in the North's border city of Gaeseong. This follows an announcement that the North has unilaterally removed the legal limit for wages there.
Uriminzokkiri, the North's major propaganda site, said on Saturday that Pyongyang had scrapped the upper ceiling on wages for workers at the Gaeseong Industrial Complex.
Seoul called the move a unilateral act that ignored a requirement for consultation.
The labor law, enacted in 2003, stipulates that North Korean workers at the complex be paid at least $50 a month, and that the annual increase should not exceed 5 percent.
The two Koreas have together agreed that the minimum wage should be set through negotiations. The figure is now $70.35, having been raised by 5 percent every year since 2007.
But the propaganda site said that under the revised law, the increases would be set every year without any limit.
If the revision is implemented, the North is expected to demand big increases in future negotiations, which the government believes will burden South Korean companies there.
Officials also said scrapping the upper ceiling for wages would make it harder for foreign companies to set up operations in the inter-Korean complex, thus dampening the government's efforts to globalize it.
The Seoul government said it had yet to confirm officially that the North had revised the wages agreement.
"There has been no official notice from the North," said a Ministry of Unification official. "Revision of the labor regulation including the wage rule needs agreement between the two Koreas. Pyongyang has taken unilateral action without agreement from Seoul."
The government is expected to express its official position and to protest against the North's move today.
About 50,000 North Koreans work at the industrial site. The economic zone is seen as the last remaining symbol of inter-Korean reconciliation, and is a major revenue source for the cash-strapped communist country.
Uriminzokkiri said the North had revised 10 clauses of the labor law, including one regarding minimum wages. What else it revised is unclear.
"The revision is to adapt to existing reality, and improve the quality of the workforce and international competitiveness," the site said.
Follow Jun Ji-hye on Twitter @TheKopJihye
The two Koreas are heading for a conflict over wages at their joint industrial complex in the North's border city of Gaeseong. This follows an announcement that the North has unilaterally removed the legal limit for wages there.
Uriminzokkiri, the North's major propaganda site, said on Saturday that Pyongyang had scrapped the upper ceiling on wages for workers at the Gaeseong Industrial Complex.
Seoul called the move a unilateral act that ignored a requirement for consultation.
The labor law, enacted in 2003, stipulates that North Korean workers at the complex be paid at least $50 a month, and that the annual increase should not exceed 5 percent.
The two Koreas have together agreed that the minimum wage should be set through negotiations. The figure is now $70.35, having been raised by 5 percent every year since 2007.
But the propaganda site said that under the revised law, the increases would be set every year without any limit.
If the revision is implemented, the North is expected to demand big increases in future negotiations, which the government believes will burden South Korean companies there.
Officials also said scrapping the upper ceiling for wages would make it harder for foreign companies to set up operations in the inter-Korean complex, thus dampening the government's efforts to globalize it.
The Seoul government said it had yet to confirm officially that the North had revised the wages agreement.
"There has been no official notice from the North," said a Ministry of Unification official. "Revision of the labor regulation including the wage rule needs agreement between the two Koreas. Pyongyang has taken unilateral action without agreement from Seoul."
The government is expected to express its official position and to protest against the North's move today.
About 50,000 North Koreans work at the industrial site. The economic zone is seen as the last remaining symbol of inter-Korean reconciliation, and is a major revenue source for the cash-strapped communist country.
Uriminzokkiri said the North had revised 10 clauses of the labor law, including one regarding minimum wages. What else it revised is unclear.
"The revision is to adapt to existing reality, and improve the quality of the workforce and international competitiveness," the site said.
Follow Jun Ji-hye on Twitter @TheKopJihye
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