South Korea's ruling Democratic Party of Korea and the government announced Wednesday they will legislate mandatory retirement pension coverage for all workplaces and convert the system into a pooled fund structure similar to the National Pension Service by year's end.
"The party and government will work closely to draft and pass amendments this year based on the 'Joint Declaration for Strengthening Retirement Pension Functions' reached by labor, management, and government on the 6th," Han Jung-ae, the Democratic Party's policy committee chair, said at a party-government consultative meeting with the Ministry of Employment and Labor at the National Assembly.
"The joint declaration's provisions for phased expansion of the Small and Medium Enterprise Retirement Pension Fund and retirement pension fund to workplaces with 300 or fewer employees, as well as mandatory external reserve requirements for retirement benefits, require amendments to the Employee Retirement Benefit Security Act," Han added.
The Labor-Management-Government Task Force for Strengthening Retirement Pension Functions had previously released a joint declaration to mandate retirement pension adoption at all workplaces with phased implementation based on workplace size and conditions, while introducing "fund-type retirement pensions" as an operational method to improve returns.
The party and government discussed forming a working-level task force comprising the Ministry of Employment and Labor, Ministry of Economy and Finance, and labor-management representatives to implement structural improvements to the retirement pension system. They also agreed to review whether to first apply external reserve requirements for retirement benefits to new public sector employees and develop support measures for small businesses.
Additionally, the party and government discussed follow-up measures for the so-called "Yellow Envelope Act" (Trade Union Act amendment) set to take effect on February 10.
"Once the enforcement decree on bargaining procedures is approved by the Cabinet meeting, we will prepare for predictable field-level bargaining around the 27th," Employment and Labor Minister Kim Young-hoon said. "The National Labor Relations Commission and the Ministry of Employment and Labor will jointly report to the public."