Consensus has been reached between ruling and opposition parties to extend the legal retirement age of South Korean workers to 60 beginning in 2016, parliamentary officials said Monday.
Currently, no legal age limit is set for South Koreans to retire but all government offices and most private-sector businesses retire their workers at between 56 and 58.
The consensus, reached between the ruling Saenuri Party and the main opposition Democratic United Party, is no surprise, because it was their campaign pledge in December's presidential election.
Officials of the two parties said the issue still needs further discussions before the National Assembly's Labor and Environment Committee reaches full agreement before it convenes its next meeting on Tuesday.
One pending issue is how to help big firms that would be burdened by the mandatory extension, they said.
Under the tentative agreement, public-sector and big businesses with 300 or more employees should mandatorily set the retirement age at 60 from 2016 and other firms from 2017, the officials said.
The two parties have tentatively agreed to gradually require the public sector and big businesses to adopt the new retirement age first as it is currently only a recommendation, they said.
Extending the retirement age has long been a hot issue in South Korea as some argued that it will allow experienced workers to contribute longer to economic growth, provide older citizens with the opportunity to work and reduce pressure on pension funds.
However, some argued about the negative effects may have on the balance sheets of businesses and job creation for younger generations.
The average retirement age at South Korean firms with 300 or more employees was 57.4 in 2010, according to the Korea Labor Institute.
More than seven million South Koreans known as babyboomers are set to reach that age within the next eight years. Those born between 1955 and 1963 account for 14.6 percent of South Korea's total population of 50 million. (Yonhap News)
