The May 26th, 2022 decision by the first division of the Supreme Court (Chief Justice Roh, Tae-Ak)
regarding the peak wage system (2017Da292343) confirms that the “prohibition on age discrimination in
recruitment, hiring, and wages according to the Elderly Employment Act” is a compulsory provision and
nullifies any other contrary decisions prescribed in collective agreements, rules of employment, or labor
contracts. This has the effect of rendering the retirement-age-retention-type peak wage system, which is
implemented solely based on ages without any rational reason, as invalid. Furthermore, the decision
subsequently provides judgment criteria to ensure the validity of such a system.
However, as stated by the Supreme Court, not all retirement-age-retention-type systems are invalid, and
decisions regarding the validity of the system implemented in different businesses may differ depending on
the satisfaction of the decision criteria.
The Ministry of Employment and Labor plans to provide proactive support to prevent any confusion related
to the system in the field after analyzing related cases and gathering opinions from members of labor and
management, as well as related experts.
For press inquiry, please contact spokesperson for the foreign media Park, Jihye(parkjihye66@korea.kr /
044-202-7763)