Large businesses should do more to raise minimum wage

By Choi Sung-jin

Negotiations between labor and management to determine the minimum wage for next year have begun in earnest but few anticipate smooth progress, given the wide gap between their positions.

Employees are calling for raising the minimum wage from the current 6,030 won to 10,000 won ($5 to $8.3) per hour while employers want to freeze it at the level it is now.

Union members say that living costs should be calculated on the basis of the household, not the individual wage earner, meaning that Korean breadwinners are supporting one or two other family members with their earning.

However, management says the minimum wage should differ according to business sectors and regions, maintaining that a uniform minimum wage does not reflect the various gaps among different industries and businesses. They also call for including bonuses, meal benefits and boarding expenses into minimum wage calculations, saying that including these, actual pay is far larger than the minimum wage.

Neutral experts note that Korea’s minimum wage is relatively low, citing the cases of the United States where some cities and states are pushing it up to $15 by 2020, almost three times higher than the present minimum wage here.

It is also true that a number of small and midsize companies will not be able to afford to pay the level targeted by the unions, they say. “The solution should center on how the government can push large business groups to support their numerous supplier firms to establish a more equitable wage system throughout the nation,” a labor expert said.