Labor, business groups reach consensus on minimum wage without vote

(Yonhap)

The labor and business groups have set South Korea’s minimum wage without a vote on Thursday, after rounds of heated debates.

The agreement, however, was marred by a walkout from the Korean Confederation of Trade Unions (KCTU), one of the country’s largest labor groups, which protested the proposed wage range as unacceptably low.

The Minimum Wage Commission held its 12th plenary meeting at the Sejong Government Complex on Thursday, where negotiations took place.

The KCTU, however, argued that it could not accept the set range within the deliberation process, leading to heated debates.

The KCTU protested that the range proposed by the public interest committee was excessively low and left the meeting around 8:35 p.m.

“I don’t think the Lee Jae-myung government is unaware of how low the range has been set,” said Lee Mi-seon, deputy chair of KCTU. “before the elections, they came to workers and said they valued them, but once they were elected, low-wage workers became invisible.”

She indicated that KCTU would criticize the Lee government in the planned general strike.

With only five labor committee members from the KCTU and nine employer committee members remaining at the table, negotiations continued.

In the 9th revised proposal, the labor sector proposed 10,440 won ($7.6), while the employer sector proposed 10,220 won, creating a 220-won gap.

Both sides immediately presented a 10th revised proposal, each offering a 10-won concession, narrowing the gap to 200 won.

The two sides held a plenary session to reach a final agreement, and by 11:20 p.m., they agreed on the 2026 minimum wage of 10,320 won, without a vote.

This marks an increase of 60,610 won in monthly wages.

Based on a 40-hour workweek, including paid weekly rest, the total monthly wage would be 2,156,880 won.

There are concerns that this could exacerbate the difficulties faced by small business owners.

Contrary to expectations that the Lee government would strongly support labor, the first minimum wage increase under the government turned out to be quite low.

The minimum wage increase rates in the first years of past governments were 7.96 percent for the Kim Young-sam administration, 2.7 percent for the Kim Dae-jung administration, 10.3 percent for the Roh Moo-hyun administration, 6.1 percent for the Lee Myung-bak administration, 7.2 percent for the Park Geun-hye administration, 16.4 percent for the Moon Jae-in administration, and 5 percent for the Yoon Suk-yeol administration.