Every spring, around February, two labor organizations and an employers’ association in Korea announce wage increase guidelines for the year. The guidelines serve as a reference for labor unions and employers in individual companies when they come to the table for wage negotiation.
As can be expected, labor unions want higher wage increase that can more than offset inflation and living expenses and employers say that wage increase should be made in consideration of business environments and actual performance of employees.
For the last few years, a repetitious pattern emerged in the guidelines. The employers’ association (KEF) has been recommending large companies to freeze their wage every year since year 2006. Labor unions have been making separate wage demands for regular workers and non-regular workers respectively. They demanded higher wage increases (about 18%) for non-regular workers to improve their low wage level, while suggesting about half the rate of non-regular workers for regular employees (about 9%).
Regardless of those demands made by labor and management, wage increase rates for the last two years were 4.8%. Things would be easier and faster, it seems, if upper organizations narrow the gap in their proposals by having heart-to-heart discussions. Of course, it is very unlikely to happen anytime soon under the strained labor relations of Korea.
The Korea International Labor Foundation translated the major points of those guidelines. The text of the translation can be read here.
