South Korean business lobby set to challenge new minimum wage rate
The Korea Enterprises Federation (KEF), representing South Korea’s businesses, has said that it would file a complaint with the government on 2022’s minimum wage rate, reports Yonhap.
This comes after the country’s minimum wage commission — comprising nine members each from labour groups, businesses and the general public — set the new minimum wage rate at 9,160 won (US$7.94) per hour for 2022, which KEF says is too high.
“A formal objection will be lodged with the labour ministry,” KEF said, adding that “the new minimum wage will threaten the survival of small companies and merchants struggling to overcome the coronavirus-induced crisis and have a negative impact on employment.”
KEF said that the country’s minimum wage has been increasing excessively over the past five years under the Moon administration.
“Should the new minimum wage proposal be finalised, most small companies and merchants will not be able to shoulder the burden of rising costs,” KEF highlighted.
The minimum wage commission is required to present the new minimum wage to the labour minister, who is then obliged to announce the new rate by August 5. The new wage rate will then take effect on January 1 next year.
South Korea’s minimum wage rose by 16.4% in 2018, 10.9% in 2019, 2.9% in 2020 and 1.5% in 2021, which registered the lowest year-on-year increase.