Successfully Represented a Global Company “S” and Prevailed on All Claims in a Lawsuit over “Retirement Age Extension Type” Peak Wage System
2024.06.28.
Yulchon represented Company “S”, a global company active in the manufacture and sale of industrial machinery, and prevailed on all claims in a lawsuit brought by its former employees seeking invalidation of the company’s “retirement age extension type” peak wage system and payment of unpaid wages.
The plaintiffs in this case, certain retirees of the company (the “Retirees”), argued that the peak wage system introduced by the company on January 1, 2016 “discriminated against employees covered by the peak wage system solely on the basis of their age, without a justifiable reason, in violation of the Act on Prohibition of Age Discrimination in Employment and Elderly Employment Promotion, a compulsory regulation, and should therefore be held invalid.” In the company’s defense, Yulchon demonstrated, based on sophisticated factual and legal analyses, that (i) the peak wage system in question is of the “retirement age extension type” implemented as part of the company’s decision to extend the retirement age, (ii) the affected employees gained more benefits than previously in terms of “total wage”, (iii) the amount of reduction and the period of reduced wages were within reasonable limits, among other things. The court fully accepted Yulchon’s arguments and dismissed the Retirees’ claims.
This case is significant as it comes amid increasing numbers of lawsuits challenging the validity of a peak wage system and demonstrates Yulchon’s high level of expertise and risk management skills in relation to peak wage systems.
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