Labor Unions Protest Proposal to Pay Bonuses in Local Gift Certificates

The labor sector voiced strong opposition today (July 9) after a ruling party lawmaker proposed a bill that would allow companies to pay bonuses and other incentives in the form of local gift certificates.

According to political sources, Representative Park Min-kyu of the Democratic Party of Korea proposed an amendment to the Labor Standards Act yesterday. The bill would allow a portion of wages to be paid in forms other than currency—such as local gift certificates as determined by presidential decree—provided that it is stipulated in a collective agreement or with the explicit consent of the employee.

In response, the Federation of Korean Trade Unions (FKTU) issued a statement today, demanding, "Wages are not a tool for policy objectives but a right that must be fully guaranteed as compensation for labor." They added, "Withdraw this amendment, which undermines the principle of direct wage payment."

The FKTU pointed out, "Although the bill is premised on the 'explicit consent of the employee,' in actual workplaces, such consent could effectively be coerced due to hiring processes, performance evaluations, or organizational culture."

When proposing the amendment, Representative Park explained, "The goal is to create a foundation for a virtuous cycle where corporate profit generation and the resulting bonuses and incentives contribute to the revitalization of the local economy."

He also provided background, noting that concerns have been raised that foreign workers have a relatively low economic impact on local communities because they send a large portion of their wages back to their home countries.

The FKTU criticized this, stating, "Bonuses and incentives are fair compensation for the results created by workers. Inducing specific consumption methods or limiting where they can be used risks undermining the very essence of wages."

The Korean Confederation of Trade Unions (KCTU) also demanded the withdrawal of the bill, arguing that it violates the principle that wages must be paid in currency.

The KCTU criticized the proposal, saying, "Given the power imbalance in employment relationships, 'consent' can hardly be considered a truly free choice. Because local gift certificates have limited places of use and expiration dates, they could effectively lead to a reduction in real wages."

The KCTU emphasized, "Taking issue with foreign workers' overseas remittances could be seen as an idea to treat wages differently based on nationality. The National Assembly should withdraw this amendment and present effective alternatives for the local economy that uphold the principle of wage payment in currency."

(Photo: Provided by Yonhap News TV, Yonhap News)
※ Please note: This article was translated by AI and may contain errors.