|▲ Labor Minister Lee Jae-kap speaks of the revised minimum wage fixing machinery on January 7 at the government complex in Seoul. [Jeong Ki-hoon/The Labor Today]|
The government has announced a plan for the revised minimum wage fixing machinery to adjust the minimum wage hike rate. The revised minimum wage fixing machinery is composed of two committees: one for setting the hike rate range of the minimum wage and another for deciding the rate of the minimum wage with the reflection of the factors of the employment level, corporate ability to pay and economic growth rate. When the government draft is accepted, it will naturally lead to control the minimum wage hike rate by reflecting the factors of poor employment indicators and sluggish economy. The government move runs against the income-led growth policy which it had formulated to make the households become the engine of growth.
Labor Minister Lee Jae-kap announced a ‘draft for the revision of the minimum wage fixing machinery’ on January 7 at the government complex in Seoul. Labor Minister Lee said that “it is time to begin a discussion for a rational, objective and fair minimum wage fixing machinery, since it was set up 30 years ago.”
According to the government draft, the Minimum Wage Commission will be restructured with a dual decision-making system. The ‘Range Setting Committee’ composed of nine experts will decide a hike rate range between the highest and the lowest. The hike rate range will be passed to the ‘Rate Determination Committee’ composed of the members representing workers, employers and the public interest which will decide the hike rate within the scope of the recommended range.
The government is mulling over the composition of the ‘Range Setting Committee’ in the methods of selecting 9 members: One method is that labor, employers and the government recommend five nominees of experts that make a total of 15 nominees, among whom six least preferred nominees will be excluded from the nomination list by labor, employers and the government in turn. Another method is that labor, employers and the government recommend three nominees each for the completion of the 9-member committee.
The 9-member experts committee will decide the highest rate and the lowest rate of the minimum wage hike, taking into account not only the cost of living for the workers and the labor income share but also the economic conditions like the level of employment, corporate ability to pay and the economic growth rate, and the grants of the social security benefits. The decision will be made by a simple majority with a quorum of five members.
Labor Minister Lee said that “the system is expected to develop to a more rational one in the minimum wage deliberation process compared to the previous practices of the tug of war between labor groups and the business circle caught in the position of their demands.” “The selection procedure for the expert members complies with the related ILO convention, as it ensures the participation of workers and employers and the resultant impartiality,” he explained.
The Rate Determination Committee will be composed of the equal participation representing workers, employers and the public interest. The size of the committee is subject to further discussion, but a reduced number of members to 21 members(7 members from each) or 15 members(5 members from each), down from the current 27 members(9 members from each). Members of the Range Setting Committee will be allowed to join the Rate Determination Committee.
The nomination right for the public interest members which was solely owned by the government is under consideration to partly grant the right to the National Assembly or labor and business groups. In a case of 7 public interest members, the National Assembly and the government nominate 3 members and 4 members respectively, or labor groups, business groups and the government nominate 5 members and exclude the least preferred nominees in turn, down to 7 public interest members.
Workers’ members and employers’ members of the Rate Determination Committee are recommended by the confederations of trade unions and the national associations of employers without changes from the current law, but the inclusion of the representatives of the youth, women, irregular workers, small and medium-sized enterprises, and micro business owners will be stipulated in the law.
The government plans to hold public hearings, albeit short, to collect the opinions in order to complete the passage of the revision by the extraordinary session of the National Assembly in February, starting with an experts’ debate slated for January 10, followed by a debate between labor, management and experts, and a TV debate and a public debate within this month. An on-line public opinion accumulation is also being conducted from 21 to 30 this month.
reported by Bae Hye-jung
translated by Kim Sung-jin
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