Outline of Minimum Wage Decision System Reform

The outline of the proposed institutional improvements aimed at resolving the criticism of recurring labor-management conflicts and hasty decisions in the minimum wage determination process is gradually being revealed.

The 'Minimum Wage System Improvement Research Group' is expected to present improvements focused on reducing the number of members in the Minimum Wage Commission and strengthening the role of specialized committees to the government.

According to a report by Edaily on the 3rd, the research group has gathered opinions on a plan to reduce the size of the Minimum Wage Commission, currently composed of 27 members with 9 each from labor, management, and public interest representatives, by more than half. This is interpreted as a measure to enhance the efficiency of the commission's operations.

Additionally, the research group suggested that specialized committees under the commission discuss appropriate wage ranges in advance and then deliberate on this basis in the plenary session. This is interpreted as an effort to enhance expertise in the minimum wage determination process.

Proposals for Regional Differential Application Included

The Minimum Wage System Improvement Research Group also presented a plan for regional differential application alongside the reform of the decision-making system.

This proposal suggests establishing a legal basis for setting region-specific minimum wages, based on the assumption that collective agreements occur within specific industries in the region.

Notably, it has been reported that there is no mandatory provision requiring regional minimum wages to be higher than the national minimum wage. This can be seen as leaving room for flexibility in applying minimum wages according to regional economic conditions and industry characteristics.

Multiple representatives from the research group stated, "The role of the research group is virtually finished," while a senior official from the Ministry of Employment and Labor said, "Once we receive the official recommendations from the research group, we will go through a process of collecting opinions from stakeholders based on that."

Revision of the Minimum Wage Act Necessary for Implementation of Research Group's Proposals

All proposals put forth by the research group require amendments to the Minimum Wage Act, and it is expected that further discussions and adjustments will take place in the legislative process.

The improvement of the minimum wage system is significant given that conflicts have been repeated in the annual decision-making process due to sharp confrontations between labor and management. In particular, there has been ongoing criticism that minimum wage decisions have been politically compromised without considering the impact on economic conditions and the labor market.

This improvement proposal is evaluated as an attempt to address these issues and establish a more rational and professional minimum wage decision-making system.

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