South Korea raises minimum wage for 2022

The rate, which is set to take effect on January 1, was increased by 5.05% from this year’s 8,720 won (US$7.6), and will raise wages of an estimated 4.36 million workers. 

Business and labour representatives had proposed widely differing rates, and the MWC eventually took the middle ground.  

Business groups had originally wanted a freeze on the minimum wage citing difficulties faced by employers due to pandemic measures. They eventually proposed to raise the rate by 1.5% to 8,850 won (US$7.7). 

On the other hand, labour groups had originally wanted to raise the rate to 10,800 won (US$9.4), but subsequently lowering it to 10,320 won (US$8.99) and eventually to 10,000 won (US$8.7) which would have raised the rate 14.7% from the current rate. 

The MWC is made up of 27 members – nine each from labour, business and the general public. The final figure was proposed by the nine members representing the general public made up of professors and experts in labour issues after both labour and business could not reach a compromise.  

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The final proposal of 9,160 won (US$8) passed the vote with 13 in favour and one abstention after all nine business representatives and four from the Korean Confederation of Trade Unions left in protest before the vote. 

The latest agreement fell short of President Moon Jae-in’s campaign promise to raise the figure to 10,000 won (US$8.7) during his five-year term, as this year’s negotiation would be the last to be held during his term, according to The Korea Herald.