7 foreign workers sacked following minimum wage hike

Indian restaurant workers in Seongnam, Gyeonggi Province, consult a labor attorney in March 2012 after the restaurant owner vanished without paying wages of tens of millions of won. The workers slept on the restaurant’s floor for six months after the owner disappeared. / Korea Times file

By Ko Dong-hwan

The South Korean government’s decision to raise the hourly minimum wage has forced cash-strapped employers to sack staff, with job agencies for foreigners the first workplaces affected.

Several employees across 34 recruiters for foreigners nationwide have fallen victim to the policy as the job agencies struggled to balance government funds and increased wages. Seven workers of job agencies whose wages have been funded by the Ministry of Employment and Labor have been sacked this year, reducing total beneficiaries from 59 to 52.

Among the sacked workers was a Thai woman, 38, who has been working in a recruiting agency in Gwangju metropolitan city since 2010. She has been helping Thai migrant workers and marriage migrants from the Southeast Asian country and was feeling “content despite low wages,” according to reports. She said she could not understand why she had to be fired when she did not even want a raise.

South Korean employees are also feeling the pinch, including a woman in her 50s who has been working with two foreign consultants at an agency in North Gyeongsang Province. But following the minimum wage rise this year, the agency sacked her, choosing to keep the foreigners because they were poorer than her.

The labor ministry’s funds for job agencies for foreigners increased this year to 982 million won ($917,000) from last year’s 722 million won. Despite the increase in government subsidies for each foreigner from 1.1 million won to 1.57 million won, the minimum wage hike ― from 6,470 won to 7,530 won an hour ― made it difficult for the agencies to manage their payrolls.