From Recruitment to Retirement: Assessing Age Discrimination and Available Remedies

Bongsoo Jung, Certified Labor Attorney / KangNam Labor Law Firm

1. His Abilities Had Not Changed?Only His Age Had Become an Issue

Mr. Kim, a 58-year-old sales manager, had worked for his company for nearly 20 years. He had developed new client accounts and trained junior colleagues. One day, however, the HR department proposed transferring him to another position, explaining that the company wanted to “build a younger organization.” A younger employee with comparable performance would remain in a key department, while Mr. Kim was to be moved to a position with limited promotion prospects.

Meanwhile, Ms. Lee, a 47-year-old experienced job applicant, saw a recruitment notice seeking “young and dynamic talent.” During the interview, instead of focusing on her experience, the interviewers repeatedly asked, “The average age of our team is in the thirties. Do you think you would fit in?”

These two stories are hypothetical examples intended to illustrate the issues involved in age discrimination.

2. Who Is Protected by the Age Discrimination Prohibition Act?

The Act on Prohibition of Age Discrimination in Employment and Elderly Employment Promotion (the “Act”) prohibits employers from discriminating against employees or job applicants on the grounds of age without justifiable reasons (Article 4-4). Its protection is not limited to older persons aged 55 or above. People who are disadvantaged because they are young may also raise claims of age discrimination.

The Act prohibits discrimination in five areas: (1) recruitment and hiring; (2) wages, other payments and employee benefits; (3) education and training; (4) job placement, transfers and promotions; and (5) retirement and dismissal. Accordingly, the entire personnel management process?from the wording of recruitment notices to the selection of employees for restructuring?may be subject to scrutiny.

3. Discrimination Can Occur Even When Age Is Never Mentioned

Direct discrimination occurs when age itself is used as a selection criterion, such as a rule stating that “only applicants aged 40 or under may apply.” Express age limits pose substantial legal risks unless a legitimate job-related need exists.

Indirect discrimination can be more difficult to identify. Suppose a company uniformly prioritizes “higher-paid employees” or “long-serving employees” for redundancy. Although the selection criteria never mention age, they may place a particular age group at a significant disadvantage. Article 4-4(2) of the Act treats the use of criteria other than age as age discrimination where, without justifiable reasons, those criteria produce particularly unfavorable outcomes for a specific age group.

However, selecting higher-paid or long-serving employees does not automatically establish a legal violation. The purpose of the criteria, the actual disadvantage caused, the availability of alternatives, and the adequacy of individual assessments must all be considered.

4. Five Common Problems in Hiring, Compensation, Training, Promotion and Dismissal

First, recruitment and hiring. An age ceiling such as “entry-level applicants must be 30 or younger,” or a rejection based on age-related assumptions, may be problematic. Employers should specify the capabilities and experience required to perform the job rather than rely on age.

Second, wages and employee benefits. Where employees perform the same work, differences in allowances or benefits based solely on their age require justifiable reasons. By contrast, reasonable differences in compensation reflecting differences in length of service may fall within a statutory exception.

Third, education and training. Excluding an entire age group with an explanation such as “We will not spend training funds on employees who will retire soon” may raise discrimination issues. Objective criteria, including training needs, job duties and the potential to apply the training, are important.

Fourth, job placement and promotion. Denying an employee promotion opportunities on the assumption that “older employees find it difficult to adapt to change,” without assessing actual performance and capabilities, may indicate age discrimination.

Fifth, retirement and dismissal. Even when a company faces financial difficulties, selecting older employees for retirement solely because of their age is legally risky. In particular, dismissals for managerial reasons must separately satisfy the strict requirements of the Labor Standards Act. Both possible age discrimination and the legal justification for dismissal must therefore be examined.

5. Not Every Age-Based Criterion Is Unlawful

Article 4-5 of the Act provides exceptions. These include cases where a particular age criterion is inevitably required by the nature of the work; reasonable differences in wages or benefits based on length of service; the establishment of a retirement age in accordance with the law; and statutory measures intended to maintain or promote employment for particular age groups.

For example, the nature of a theatrical role depicting a person in a particular age range may justify considering an age-related requirement. But abstract explanations such as “Customers prefer younger employees” or “We want to create a younger workplace atmosphere” do not, by themselves, justify an age restriction.

Mandatory retirement must be considered separately. The Act recognizes retirement-age provisions meeting statutory requirements as an exception to age discrimination. Employers must set the mandatory retirement age at 60 or above (Article 19). Where an employer sets it below 60, it is deemed to be 60. This does not, however, automatically justify disadvantageous treatment before the employee reaches retirement age.

6. What Should an Employee Do After Experiencing Discrimination?

If Mr. Kim suspects that his transfer was motivated by his age, he should first secure the personnel transfer notice, performance records, promotion and placement criteria, relevant emails, and notes of meetings. Evidence showing how comparable employees in other age groups were actually treated will also be important.

A person subjected to age discrimination may file a petition with the National Human Rights Commission of Korea (Article 4-6). If the Commission finds discrimination and recommends remedial measures, and the employer fails to comply without justifiable reasons, a corrective order from the Minister of Employment and Labor may be considered where the statutory conditions are met (Article 4-7). Separate criminal sanctions apply to age discrimination in recruitment and hiring. Retaliatory or otherwise disadvantageous treatment for filing a discrimination petition or report is also prohibited.

If the matter also involves dismissal, the employee should not overlook the statutory filing deadlines for other remedies, including an application for relief from unfair dismissal before the Labor Relations Commission.

7. What Companies Should Review Is Not Age, but Their Criteria

Preventing age discrimination requires more than deleting age limits from job advertisements. At every stage of personnel management, employers should be able to answer a basic question: “Why is this criterion necessary?”

For recruitment, companies should retain job descriptions and competency assessment forms. For training, they should document participant selection criteria; for promotion, performance and competency assessment records; and for restructuring, evidence of objective selection criteria and consideration of alternatives. Even apparently neutral criteria should be examined for any disproportionate impact on particular age groups.

In an aging labor market, age can no longer serve as a convenient substitute for an assessment of work capability. If employers assume that a 30-year-old lacks experience or that an employee approaching 60 is resistant to change, they risk losing capable people and exposing themselves to legal disputes.

Ultimately, the central principle of the prohibition against age discrimination is not that every employee must be treated identically. Rather, where different treatment is necessary, employers should be able to explain it by reference to job requirements, performance and objective business needs?not age.