1. Labor demands high increase in minimum wage
The two national union centers (FKTU, KCTU) and civic groups demanded a significant increase (21.6%) in minimum wage for 2014 in a press conference on May 8, which disregards the difficult economic situation (a mere 2% economic growth expected) and business climate for small and medium enterprises. Business and worker representatives are expected to face tough negotiations during the Minimum Wage Council. Meanwhile, labor is planning a series of outdoor rallies and propaganda in support of their minimum wage demands.
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– Per hour: US$5.25 (21.6% increase over 2013)
– Per month: $1,097 (based on 40-hour work week)
<Labor’s minimum wage calculation>
– Half of average wage of all employees
(Average wage of all employees ($2,195) ÷ 2 = $1,097)
– Calculation of hourly wage = $1,097 ÷ 209 hours = $5.25
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2. Two umbrella unions announce their findings on time-off
On May 6, the two umbrella unions (the FKTU and KCTU) revealed the findings of their survey on time-off. They claim that the survey is evidence that the number of paid full-time union officers has been decreasing since the implementation of the time-off system in July 2010. However, this finding does not fully represent the use of time-off in all workplaces, as the KMWU (Korean Metal Workers’ Union, the largest trade union affiliated with the KCTU) did not participate in the survey. In fact, only 5 out of 16 industry-level unions affiliated with the KCTU participated in the survey.
Meanwhile, the FKTU is gathering comments on time-off limits from its affiliated trade unions. At the Time-off Deliberation Committee, the FKTU is planning to demand j an increase of time-off limit for small and medium workplaces, k extra time-off for workplaces with work shift system, l application of time-off to the union officials dispatched to upper-level unions.
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– The number of paid full-time union officers has decreased since the implementation of the time-off system
– The time-off system is causing more difficulties to the workplaces distributed across the nation and those with shift systems
– The time-off system is causing trade union activities to decrease
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3. Controversy over ordinary wage deepens
The KCTU is making an issue of a remark made by President Geun Hye Park during her visit to the U.S while the class action lawsuit on ordinary wage continued. During President Park’s visit, Dan Akerson, Chairman & CEO of GM stated that GM is willing to invest US$8 billion in Korea over the next 5 years, but the issue of ordinary wage is an obstacle to this investment. President Park responded that the issue is causing problems not only for GM but also for the entire Korean economy, and that she will be working to resolve the issue in a reasonable manner.
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– Oppose any change of various allowances and regularly paid bonus into the category of ‘flexible wage’ and introduction of performance-based salary system
– Demand that regularly paid·fixed·uniform allowances and regularly paid bonuses be included in ordinary wage through collective bargaining
– Demand “at least 3 years of unpaid statutory allowances” as determined by their new ordinary wage calculation
– If employers refuse to pay these “unpaid allowances”, trade unions should file a lawsuit and continue to demand negotiations on ordinary wage
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The KCTU and KMWU held a press conference on May 14 denouncing President Park’s comments as “inappropriate”. The KCTU refused to participate in a tripartite dialogue on ordinary wage and demanded revisions to the government’s guidelines in a way to include regularly paid bonuses into ordinary wage. The KMWU also issued its guidelines to affiliated trade unions.
Academic circles have suggested that controversial clauses in determination of ordinary wage should be clarified by law to reduce further confusion in workplaces. In detail, the Enforcement Decree of the Labor Standards Act should clearly state what is included in ordinary wage. For example, the Minimum Wage Act states that only wage which is ‘paid regularly once or more every month’ is included in minimum wage.