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Wage/Severance

What is the Total Wage System?

10/1/2025
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Author:system
A system that determines the wage increase rate based on the amount obtained by summing up the basic salary and various allowances, bonuses, etc., that the worker receives fixedly over one year and dividing by 12. The total wage includes all allowances with fixed payment amounts, such as fixed basic salary, job duty allowance, regular bonuses, annual and monthly leave allowances, etc. Performance-based bonuses and special bonuses paid according to business performance, such as overtime work allowance, night work allowance, holiday work allowance, etc., are excluded. It is a wage policy announced by the Ministry of Employment and Labor in 1992 through the 'Wage Negotiation Guidance Guidelines'. It aims to rationalize the wage system to prevent illegal wage increases through the creation of allowances under various names and to restrain wage increases in high-wage industries, and is implemented targeting public officials, public and public-private enterprises, media companies, large corporations, etc. However, labor unions of large corporations, public institutions, media companies, etc., designated as key management targets, view this system as being used as the government's wage control policy and are rebelling on the grounds that it infringes on the equality rights and autonomous collective bargaining rights guaranteed by the Constitution.

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