Financial industry workers on strike against incentive wage system

By Park Sae-jin Posted : September 23, 2016, 13:18 Updated : September 23, 2016, 13:18

Financial industry workers rally at a soccer stadium in Seoul after boycotting work in protest at a new wage system. [Photo by Yoo Dae-gil = dbeorlf123@ajunews.com]


Tens of thousands of South Korean financial industry workers boycotted work Friday for a one-day strike opposing a performance-based incentive wage system, but banks reported no serious disturbances in their operations.

The Korea Financial Industry Union (KFIU), an umbrella labor group, said the walkout drew about half of its 100,000 union members from 10,000 branches of the country's 15 financial institutions. The labor ministry put the number of strikers at 20,000.

The group demanded financial regulators stay away from labor-management relations, insisting the incentive wage system could be used by banks to go ahead with easier layoffs than before.

Financial regulators have warned of harsh punishment against illegal labor activities saying a strike by high wage earners in the banking sector would fuel public resentment when South Korea has been wrestling with painful corporate restructuring.

"The Incentive wage system is aimed at providing a fair reward based on performance," Yim Jong-yong, chairman of the Financial Services Commission, said Wednesday, adding the system has been widely introduced at private companies.

Yim has urged financial companies to streamline their structure and eradicate an easy-going attitude and complacency.

As part of her economic reform package, President Park Geun-hye has vowed to push ahead with the introduction of greater labor market flexibility. State-run companies and financial companies are under pressure to introduce the new wage system from January 1 next year.

Workers are afraid of losing important protections, arguing Park's package would result in lower wages and little job security.  Unionized railroad workers have threatened to go on strike starting Tuesday.

Aju News Lim Chang-won = cwlim34@ajunews.com
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