CONTENTS
- 1. Aged Employment Act | Grounds for the Claim Brought by a Re-Employed Older Worker
- 2. Aged Employment Act | Obligations and Sanctions Under the Aged Employment Act
- - Employer Obligations
- - Sanctions for Employer Violations
- - Recent Precedents Concerning the Aged Employment Act
- 3. Aged Employment Act | Strategy for Responding to a Confirmation of Nullity of Dismissal Claim
- - Strategy 1: Conduct That Cannot Be Regarded as Age Discrimination
- - Strategy 2: Denying That the Dismissal Resulted From the Reporting Remarks
- - Strategy 3: The Legitimacy of the Dismissal Procedure
- 4. Aged Employment Act | Recognition of a Justified Dismissal With No Grounds for Nullity
1. Aged Employment Act | Grounds for the Claim Brought by a Re-Employed Older Worker
This is the account of a corporate client who became the respondent in a lawsuit seeking confirmation of invalidity of dismissal on the ground that it had violated the Aged Employment Promotion Act.
The client was a small and medium-sized manufacturer with 300 or more regular employees, a workplace required to make efforts to employ aged persons at or above the standard employment rate.
In manufacturing, where aged persons are also employed in excess of 2% of the workplace's number of regular employees, there were tax benefits such as tax reductions, so the client's company tended to actively employ aged persons.
However, one aged worker employed accordingly (hereinafter the plaintiff) had work efficiency far lower than initially expected, and eventually went so far as to readily direct verbal abuse at employees younger than himself at the workplace, repeatedly causing discord.
After much consideration, the client dismissed the plaintiff, but the plaintiff, claiming that ‘he was dismissed because he was old’ and invoking the Aged Employment Promotion Act, went so far as to file a lawsuit seeking confirmation of invalidity of dismissal.
The client, who had to defend against the lawsuit seeking confirmation of invalidity of dismissal, requested a consultation with our firm's 🔗corporate attorney, where a labor attorney and an attorney can resolve the case together.
2. Aged Employment Act | Obligations and Sanctions Under the Aged Employment Act
The ‘violation of the Age Discrimination Act’ asserted by the plaintiff refers to a violation of the Act on Prohibition of Age Discrimination in Employment and Elderly Employment Promotion.
Under that Act, the standard for an elderly person means a person aged 55 or older, and a person aged 50 or older but under 55 is defined as a quasi-elderly person.
Under the Elderly Employment Act, an employer bears obligations such as the priority employment obligation, the employment effort obligation, and the obligation not to discriminate against elderly persons.
If these obligations are not observed, a corrective order and an administrative fine may be imposed, and, depending on the case, an employer may even be sentenced to imprisonment.
Employer Obligations
- Priority employment obligation : Where a priority employment occupation is newly established or expanded, or where a vacancy arises in a priority employment occupation due to retirement, job change, or similar reasons, the State, local governments, and institutions designated as public institutions, among others, shall give priority in hiring to the aged and the quasi-aged
- Employment effort obligation : An employer of a workplace that ordinarily employs 300 or more workers must make efforts to employ the aged at or above the standard employment rate and is obligated to submit its employment status
- Retirement age system : Where the retirement age of a worker is extended to 60 or older, efforts to reform the wage system and to provide reemployment, reemployment support services, and the like
- Obligation not to discriminate against the aged : In recruitment and hiring, wages, welfare, education and training, placement and transfer, promotion, retirement, and dismissal, among others, an employer shall not discriminate on the basis of age without reasonable grounds
Sanctions for Employer Violations
Under the Act on Prohibition of Age Discrimination in Employment, where an employer subjects a worker to disadvantageous treatment such as dismissal, transfer, or disciplinary action on the ground that the worker filed a complaint, submitted materials, brought a lawsuit, or made a report regarding age discrimination, the employer may be liable to imprisonment for not more than two years or a fine of not more than 10 million won.
In this case, under the joint penalty provision, the same fine is also imposed on the corporation.
In addition, an employer that has received a recommendation for remedial measures from the National Human Rights Commission, and that fails without justifiable grounds to implement the following recommendations, will be issued a corrective order covering matters such as cessation of the age discrimination, restoration of the victim, and measures to prevent recurrence.
Where a corrective order under the Act on Prohibition of Age Discrimination in Employment is not carried out without justifiable grounds, an administrative fine of not more than 30 million won is imposed.
Recent Precedents Concerning the Aged Employment Act
1. Retirement-age-extension salary peak system, company prevailed
A retired worker claimed that the retirement-age-extension salary peak system was invalid and sought unpaid wages
→ It was argued that the extent and period of the wage reduction were within a reasonable range and that the total wages increased compared to before the implementation of the salary peak system, and the claim was dismissed
2. Claim for unpaid wages on grounds of age discrimination, claim dismissed
A lawsuit seeking payment of the wage differential for violation of the Aged Employment Act, asserting a ‘retirement-age-maintenance’ salary peak system
→ It was proven that it was a retirement-age-extension salary peak system introduced after extending the retirement age, that the wage reduction rate was not large, and that welfare benefits were maintained, so the degree of disadvantage was not significant
→ The work intensity was low, so the actual workload was reduced
→ After the introduction of the salary peak system, workers on leave returned and new personnel were hired, so it was proven that the funds were used for purposes consistent with the objective of introducing the salary peak system, and the plaintiff's claim was dismissed
3. Aged Employment Act | Strategy for Responding to a Confirmation of Nullity of Dismissal Claim
After closely reviewing the client's matter, the corporate attorney confirmed that the matter did not constitute a violation of the Act on Prohibition of Age Discrimination in Employment.
To establish that this was not a matter in which the plaintiff could seek confirmation of the invalidity of dismissal, the corporate attorney TF developed the following strategy.
Strategy 1: Conduct That Cannot Be Regarded as Age Discrimination
Under the Act on Prohibition of Age Discrimination in Employment, where there is no reasonable ground relating to hiring, wages, retirement, and the like, discrimination may not be carried out on the basis of age.
However, an employer may set differences in wages, employee benefits, and the like by taking into account differences in length of service.
The plaintiff had worked for a long period in a different occupation and then found reemployment in the manufacturing field, so the plaintiff's experience in the client company's specialized field was considerably lower.
The client maintained that the wage difference was set in accordance with this circumstance and was not a wage discrimination based on the plaintiff's age, and rebutted this point using the plaintiff's certificate of career and the existing employment contract as evidence.
Strategy 2: Denying That the Dismissal Resulted From the Reporting Remarks
The plaintiff argued that the reason for the dismissal was the statement that the plaintiff would ‘report the client's company to the National Human Rights Commission for violating the Age Discrimination Prohibition Act.’
However, the main reasons for the plaintiff's dismissal were poor work attitude and unfaithful performance of duties.
The corporate attorney presented materials such as periodic evaluation sheets and quality inspection results demonstrating the poor work attitude and unfavorable performance evaluations, and emphasized, by reference to existing Supreme Court precedent, that this constituted a justifiable ground for dismissal.
Disciplinary dismissal of an insurance company employee for poor solicitation performance : discipline justified (Supreme Court, Judgment of March 27, 1991, 90Daka25420)
Strategy 3: The Legitimacy of the Dismissal Procedure
The procedure by which the plaintiff was dismissed was also carried out with proper justification.
The client gave the plaintiff 30 days' advance notice of dismissal, and after the notice of dismissal, the plaintiff worked even more negligently.
In addition, the client's side provided notice in writing that clearly stated the grounds for dismissal and the timing of dismissal.
Accordingly, because the dismissal followed lawful procedures, it could not serve as a cause for a lawsuit confirming nullity of dismissal, and we emphasized this point and firmly requested dismissal of the plaintiff's claim.
Evidence for the Company to Defend Against a Lawsuit Confirming Nullity of Dismissal
4. Aged Employment Act | Recognition of a Justified Dismissal With No Grounds for Nullity
In this lawsuit seeking confirmation of the invalidity of dismissal, the court found that there was no matter violating the Age Discrimination in Employment Act and recognized that the plaintiff had been dismissed for a justifiable reason.
Accordingly, it rendered a judgment dismissing the plaintiff's claim.
The client expressed gratitude, saying that with the assistance of a corporate attorney the unfounded claim of the plaintiff was dismissed and the case could be concluded quickly.
In a lawsuit seeking confirmation of the invalidity of dismissal, proving a justifiable ground for the dismissal is important.
This case was also intertwined with the Age Discrimination in Employment Act, so the issues were complex, but with the strategy established by an attorney who has handled many 🔗human resources and labor cases, it could be concluded amicably.
The Age Discrimination in Employment Act only prohibits unfavorable treatment in employment on the ground of age, and it does not mean that the treatment of all elderly persons is protected unconditionally.
Therefore, where it is clearly demonstrated that there is a reasonable ground, it cannot be regarded as age discrimination.
If you are facing a legal dispute with an employee, such as a violation of the Age Discrimination in Employment Act, a lawsuit seeking confirmation of the invalidity of dismissal, or a wage claim, you may at any time consult Daeryun, ranked 9th among law firms in Korea (based on 2025 National Tax Service value-added tax filings), 🔗corporate attorneys.
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