This article was displayed on the ChosunBiz RM Report website at 5:14 p.m. on Aug. 11, 2026.
The statutory economic organization representing the rights and interests of small business owners, the Korea Federation of Micro Enterprise (KFME), filed an administrative suit against the government to cancel the 2027 minimum wage notice. Next year's minimum wage is 10,700 won per hour. This is the second lawsuit by the KFME related to the minimum wage since 2017.
Nine years ago, it challenged the method of converting the minimum wage into a monthly salary by including paid weekly holiday hours. This time, it is disputing the amount of 10,700 won per hour itself, the lack of differentiated application by industry, and the claim that small business owners' opinions were not sufficiently reflected in the decision-making process.
However, lawsuits seeking to cancel the minimum wage notice itself have not been accepted by courts in the past. Since courts have broadly recognized the discretion of the government and the Minimum Wage Commission in setting the minimum wage, the key issue is whether the KFME can prove illegality different from existing precedents.
◇ Nine years ago it was "209 hours"… this time it's "10,700 won"
According to legal sources on the 12th, the KFME filed a lawsuit with the Seoul Administrative Court on the 5th to cancel the 2027 minimum wage finalized and announced by the Ministry of Employment and Labor (MOEL). It also plans to request a constitutional review, arguing that parts of the minimum wage system violate the Constitution.
The 2027 minimum wage is 10,700 won per hour, up 380 won (3.7%) from this year's 10,320 won. The monthly converted amount (standard working hours 209 hours) is 2,236,300 won.
The KFME also filed a lawsuit over the 2018 minimum wage in 2017. At the time, it did not challenge the amount of 7,530 won per hour itself, but the method of calculating the monthly conversion. It argued that it was improper for the government to calculate based on 209 hours per month including paid weekly holiday hours and that 174 hours should be applied.
The court dismissed the case without a ruling on the merits, saying the monthly conversion amount is not an administrative disposition that directly affects the rights or obligations of employers or workers.
This lawsuit is different in nature. The KFME is challenging the minimum wage level itself, the lack of differentiated application by industry, and even the representation of small business owners in the minimum wage decision process.
KFME Chair Song Chi-young said, "In 2017, we only disputed the method of calculating the monthly conversion amount, but this time we will dispute the minimum wage level, the differentiated application by industry, and the representation of small business owners."
◇ Similar claims already dismissed… new statistics and evidence are key
Courts have so far taken a cautious stance on overturning the minimum wage decision itself.
In 2019, the Seoul Administrative Court ruled against 13 small business owners who sought to cancel the minimum wage notice. The plaintiffs argued that the structure of the minimum wage decision, centered on public interest members whose appointment the government is involved in, was biased, but the court did not accept this. It also found that broad discretion is recognized for the government and the Minimum Wage Commission regarding the minimum wage level.
A request to cancel the minimum wage notice filed in 2020 by the Korean Confederation of Trade Unions (KCTU) and others was also not accepted. The court held that, since the Minimum Wage Commission reviewed necessary data such as wage levels and labor productivity in making its decision, its judgment should be respected.
Attorney Son Jun-ho of Human Law Office said, "This lawsuit overlaps considerably with prior cases in its issues," and noted, "Given that courts have not recognized deviation or abuse of discretion, the chances of winning may not be high."
◇ Constitutional Court also pointed out the issue of small business representation
Separately from the question of winning, some say the structure of the minimum wage decision needs to be revisited.
In 2019, the Constitutional Court found the 2018 and 2019 minimum wage notices constitutional. However, in a concurring opinion, three justices noted the possibility that the views of small business owners and the self-employed may not be sufficiently reflected and pointed to the need to improve the composition of the Minimum Wage Commission.
Attorney Son Ik-chan of Deoksu Law Firm said, "Regardless of the outcome of the lawsuit, procedures need to be supplemented so that small business owners can fully present their management situations and views."