국회 환경노동위원회 김성태 법안심사소위원장이 23일 국회 환경노동위 소회의실에서 열린 법안심사소위 회의에서 공공ㆍ민간 부문 근로자의 정년 60세 의무화를 오는 2016년부터 단계적으로 시행하는 내용의 '정년 60세 연장법'을 통과시키고 있다. (연합뉴스)
Mixed reactioins over longer retirement age
By Cho Chung-un
Rival parties reached a final agreement Tuesday to raise the legal retirement age to 60 starting in 2016 in a landmark move to help the nation cope with the aging population and an impending pension fund crisis.
The plan, however, instantly sparked fierce opposition from young workers who fear losing their share of already limited jobs.
Companies also expressed concerns about the financial burden of retaining older workers who usually get higher salaries than young employees.
To placate opponents, the government said it would come up with supplementary measures to reduce companies’ costs and create more jobs for young people.
Under a bill passed by the screening panel of the National Assembly’s Labor and Environment Committee Tuesday, all public offices and private firms with 300 or more employees should extend the retirement age of their workers to 60 beginning in 2016. The mandatory rule will be imposed on other, smaller firms from 2017, officials said.
The proposal is expected to be put to a vote at a parliamentary plenary session on April 29 or 30, they added.
Currently, Korea has no legally set age limit for workers. Workers in both the public and private sectors generally retire between ages 56 and 58. According to the Korea Labor Institute, the average retirement age at Korean firms with 300 or more employees was 57.4 in 2010.
The committee also settled other pending issues such as readjusting the current seniority-based wage system for older workers if they are given more years to work.
If any dispute occurs between workers and companies during the wage readjustment process to essentially a wage peak system, both parties can request the Labor Relations Commission's mediation, officials said.
The bill also includes allowing the government to impose penalties on businesses if their employees retire before they reach 60.
The increase in the retirement age was a presidential election campaign pledge of both the ruling Saenuri Party and the main opposition Democratic United Party.
President Park Geun-hye promised to increase the retirement age for senior workers, pointing out the growing number of seniors in poverty. The government needs to offer welfare benefits as well as job opportunities for seniors, she said.
Labor groups welcomed the plan, saying it will allow experienced senior workers to contribute to the country’s economic growth and also help them better prepare for retirement.
However, they flatly opposed the wage peak system proposed by the ruling party and the government, saying it would lower the working conditions for seniors.
“Extending the retirement age is an inevitable choice in this rapidly aging society to help (senior citizens) escape from poverty,” said a senior official at the Korean Confederation of Trade Unions.
“The ruling party has suggested adopting a system that readjusts the wage level of (senior workers). We are opposed to the plan because it will intensify instability of the country’s labor market and worsen working conditions,” he added.
The corporate sector expressed concerns that the new retirement age plan would impose a heavy financial burden on companies and thus dissuade them from hiring new workers. The companies also said that a wage peak system or performance-based wage system should be adopted along with the new retirement age plan.
“If (the government and the parliament) push ahead with the plan, it would only increase the financial burden on the private sector and force them to downsize their recruitment plans,” said an official at the Korea Employers Federation.
The government is seen as supporting the corporate sector in regard to the wage peak system as it worries that the plan would reduce job opportunities for younger workers.
“Extending the retirement age can undermine the country’s youth employment. Adopting a wage peak system has to be considered alongside that plan,” an official at the Ministry of Employment said.
Even with the ongoing parliamentary talks, the government seems to be unprepared for the new plan. The Labor Ministry said in a previous briefing to President Park that it will implement the new retirement age plan by 2017, a year later than what the political parties agreed to. Officials at the ministry said it will conduct a study to assess the plan’s effect on new job creation and how many workers will benefit, immediately after the bill gets parliamentary approval.
Young workers also expressed concern, citing a high jobless rate for the country’s youth.
According to Statistics Korea, the unemployment rate for youth aged between 15 and 29 reached 8.4 percent in the first quarter this year, more than double the overall national jobless rate of 3.6 percent.
“Many young workers, including myself, have been struggling to find jobs in the market that has suffered from the economic downturn in recent years. I feel bad if I have to compete with senior citizens for limited jobs,” said Kim Min-sun, a 32-year-old office worker in Seoul.
(christory@heraldcorp.com)
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