By Kim Rahn
The government is seeking to pass a law setting the official retirement age at 60 in a move to protect jobs for aging workers.
To date, each company has set its own age limit through agreements between management and unions, so if passed the law will set a precedent for the retirement age for private sector workers
According to the Economic and Social Development Commission, Monday, its Committee on Employment Measures for Baby Boomers Age has discussed ways to ensure the employment of 7.12 million baby boomers — born between 1955 and 1963 — who have already started retiring.
The committee, comprised of four members from the government, three each from management and the Federation of Korean Trade Unions (FKTU), and five from civic groups, will announce a decision around March 23 when it wraps up one year of research.
The committee’s civic group members have come up with a tentative conclusion that the nation needs to pass a law to set the retirement at 60, considering the age of the baby boomer generation.
The retirement age set by companies is on average 57.16, but in reality workers are around 53 when they usually leave work. For high-ranking civil servants, the retirement age is 60 and that for their subordinates will be the same by 2012.
Whether the retirement age will actually be fixed by law remains to be seen, as the move has come under criticism for worsening youth unemployment and increasing labor costs.
“There are disputes over setting a retirement age by law, whatever age it will be. Some say it will prevent companies from hiring young workers. Unions want the system to be adopted as soon as possible, while management opposes it, saying they want flexibility in employment and wages first,” said Kwon Young-soon, director general at the Ministry of Employment and Labor’s equal employment policy bureau.
“The tripartite committee is discussing setting the age limit at 60 but hasn’t reached a conclusion. But it understands that the nation needs some countermeasures against upcoming retirement of baby boomers in this aging society,” he said.
The Korea Employers Federation opposed setting a legal retirement age.
“We acknowledge the need for older people to remain in the labor market. But those workers usually receive higher wages according to the seniority system, so extending the retirement age through fixing it by law will weaken corporate competitiveness,” an official of the federation said.
“Instead, we propose the government prepare measures to reduce companies’ labor cost burden, such as not turning non-regular job status of workers aged over 55 into regular ones after two years of employment.”
In contrast, unions are calling for prompt action. Choi Sam-tae, a spokesman for the FKTU said,
”This has been discussed since the Roh Moo-hyun administration. Some say that older workers remaining in employment with a lengthened retirement age will prevent young people from getting jobs. But the positions that older employees and younger workers take are different. Young people’s unemployment should be dealt with separately from the retirement age issue.”
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