Are all wage peak systems invalid? The standard of judgment presented by the Supreme Court is

<Anchor>

The Supreme Court ruled that the current wage peak system, which simply cuts wages according to age, is 'invalid'.

He also suggested a 'judgment standard' to secure the legitimacy of the wage peak system, saying that in order to reduce wages, work should be reduced and the reduced wages should be used for the same purpose as new hires.

This is reporter Han So-hee.

<Reporter>

National Research Institute employee A has been subject to the wage peak system since 2011, when he turned 55.

In the performance evaluation, if he had the highest grade, he received 930,000 won less in salary, and if he had the lowest grade, 2.83 million won was reduced.

The retirement age was the condition that was maintained until the age of 61 as it was originally.

After his retirement, Mr. A filed a lawsuit to return the lesser wages due to the wage peak system.

[Kim Seon-jong / Plaintiff's attorney: Because they gave me the same salary as the employee (with the employee) after 26 years...

.

It would be unfair to discriminate simply because of age without any other substantial compensation...

.]

Following the 1st and 2nd trials, the Supreme Court upheld Mr. A's hand, saying that the wage peak system applied to Mr. A violated the Elderly Employment Act.

In other words, it is invalid because it violates the provision not to discriminate on the basis of age without reasonable grounds.

The Supreme Court also presented for the first time the criteria for judging the legal wage peak system.

The purpose of the introduction is that if the wage was adjusted within a reasonable range, it would be considered legal, considering whether the purpose of the introduction was justified, whether the workload and intensity decreased due to the wage cut, and whether the reduced wage was used for the purpose of creating new jobs.

Of the 340,000 businesses in Korea that have a retirement age system, about 22% or 76,000 have introduced the wage peak system.

Similar lawsuits are expected to follow in places that have chosen to reduce wages only based on age without increasing the retirement age, as in this case.