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Wages play the most important role in labor law. This Wage Manual consists of a definition of wages, classification of statutory wages, method of paying wages and remedies for unpaid wages, and the retirement benefit system. First of all, this manual explains the theory of wages by category and provides related practical labor cases that have frequently occurred in relation to wages.
Wage systems in Korea have had two major changes in recent years, the first of which is the place that fixed bonuses have in ordinary wages and the second regarding the illegality of a comprehensive wage system.
In the first case, an important court ruling in the classification of statutory wages is the determination that bonuses paid on a regular basis are included in ordinary wage, which was the decision by all judges on the Supreme Court in December 2013. This ruling led to reorganization of the distorted wage structure and, above all, set consequences that limited the overtime working hours of production workers. Secondly, a change expected as much as the above ordinary wage judgment was the one on comprehensive wage systems, which refer to the practice of including any overtime in pre-determined fixed wages for office workers. Since 2007, such comprehensive wage systems for office workers whose working hours can be calculated, have been judged as illegal in the courts. This text includes such cases explained in detail.
I hope this manual will be of assistance to HR managers in giving them an opportunity to better understand the legal concept of wages and see how wage-related matters in labor law apply in practice.
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