The appellate court overturned a lower court’s decision, ruling that the implementation of the wage peak system at KB Credit Information was lawful in its purpose and procedure. The system, introduced after a collective agreement with the labor union in 2016, extended the retirement age from 58 to 60 while reducing salaries from the age of 55. While the initial court ruling favored the employees—demanding the company to pay most of the claimed amount for salary and severance— the appellate court dismissed these claims.
The court reasoned that the wage reductions, though they included financial disadvantages for older workers, were not excessive in light of the benefits of extended employment. The court also noted the company’s efforts to minimize losses by adjusting workloads and providing incentives based on performance.