Establishment of Retirement Benefit Schemes, Etc.
Employer Mandate to Establish and Offer a Retirement Benefit Scheme- To provide retirement benefits to retiring employees, an employer is required to establish at least one of the retirement benefit schemes (Article 4(1) of th eAct on the Guarantee of Workers’ Retirement Benefits).
※ Employees whose length of continuous employment is less than one year and those whose weekly work hours are less than 15 based on a four-week average are excluded from the coverage above (Proviso of Article 4(1) of the Act on the Guarantee of Workers’ Retirement Benefits).
- If there is a labor union to which a majority of employees are members, the employer must receive its opinion or consent (if no such a labor union exists, the consent from a majority of employees is required), when setting up a type of retirement benefit scheme (Article 4(3) and (4) of the Act on the Guarantee of Workers’ Retirement Benefits).
Application of the Same Rules- When establishing a type of retirement benefit scheme, the employer shall not make any differentiation regarding application of a method, etc. for calculating the amount of benefits or contributions within the same business (Article 4(2) of the Act on the Guarantee of Workers’ Retirement Benefits).
- The employer, who makes a differentiation within the same business when designing a retirement benefit scheme, will be punished by imprisonment with labor not more than two (2) years or a fine of up to KRW 20 million (Subparagraph 1 of Article 45 of the Act on the Guarantee of Workers’ Retirement Benefits).