Mandatory retirement in Korea: an overview of the past and present

Abstract

In Korea, contractual mandatory retirement for many workers at relatively young ages, sometimes as early as the mid-40s, has been a defining feature of the labor market and workplaces for decades. The average age of retirement from full-time permanent employment positions is 56, after which most involuntarily retired workers must continue in paid employment either on a contractual or self-employed basis because they have insufficient savings for a permanent exit from the labour market. This chapter examines this practice, including how it arose and is embedded in aspects of Korean culture and history. As with other entrenched features of a society, mandatory retirement is an institution whose origins and impacts extend beyond the labour market and workplace. The chapter also analyses the reforms to mandatory retirement that have been unleashed by unprecedented recent legislation that is to set age 60 as the contractual age of retirement across Korea as of 2017.