The Korean Confederation of Trade Unions (KCTU) announced its decision to boycott the Minimum Wage Commission on Wednesday, two days after the Federation of Korean Trade Unions (FKTU) walked away to protest the legislation.

The National Assembly on Monday passed the new rule, which calls for newly counting in some regular bonuses and welfare allowances when calculating minimum wage. The inclusion offsets the effect of a raise in minimum wage.

South Korea raised the hourly minimum wage by 16.4 percent to

7,530 won in January, the biggest hike in nearly two decades, and plans to increase the threshold to 10,000 won by 2020. Counting in bonuses and other benefits in minimum wage calculation was one of the demands from businesses.

"The KCTU has determined that the Minimum Wage Commission has lost its role with the passage of the minimum wage reduction law.

We will not take part in (the commission)," said Kim Myoung-hwan, chairman of the KCTU. "We will cooperate actively with the FKTU on this."

The commission is charged with coming up with the minimum wage levels through three-way discussions between labor, management and government. The two labor groups' decision to boycott the commission would lead to suspension of discussion on determining the minimum wage for next year.

Kim said the KCTU will organize strong anti-government protests against the legislation.

"President Moon Jae-in should immediately decide to rescind the minimum wage reduction law," he said.

The KCTU plans to hold a sit-in protest in front of the presidential office starting Friday, launch a nationwide campaign to collect 1 million signatures calling for scrapping the law and hold a large-scale protest rally next month. (Yonhap)