The nation’s top court ruled Thursday that GM Korea Co. should count performance-based monthly wages paid to its employees as part of their ordinary salaries. (Image : Yonhap)
SEOUL, Nov. 26 (Korea Bizwire) – The nation’s top court ruled Thursday that GM Korea Co. should count performance-based monthly wages paid to its employees as part of their ordinary salaries.
A total of 1,025 of its workers filed a lawsuit demanding the management include performance-based pay and vacation stipends as part of ordinary pay and that the ruling be applied retroactively.
Ordinary wages refer to a fixed amount paid to an employee on a regular basis and are used as the basis for calculating certain employee benefits, such as overtime pay, paid annual leave, severance and other allowances.
Upholding most of the decision made by a lower court, the Supreme Court partially ruled in favor of the plaintiffs, saying that management should count performance-based pay as ordinary wages.
“The performance-based pay is regularly paid during the year without a change once decided, qualifying the ordinary wage’s condition on fixedness,” the court said.
The court, however, sent the case back to the lower court, saying some other payments such as vacation bonuses and annuity insurances cannot be acknowledged as ordinary wages.
Officials of GM Korea, the local unit of U.S. carmaker General Motors, were not immediately reached for comment.
(Yonhap)
