Health ministry tightens senior-hiring rules for elder-friendly firms from 2027

South Korea's health ministry said Wednesday it will exclude registered executives, senior managers, high earners and people with effective control of a company from the hiring totals that qualify firms for its elder-friendly workplace programme, starting with designations made in 2027.

The change reverses a loosening the ministry introduced in 2022, when it widened the programme to bring in larger companies and simplified the rules so that everyone other than the chief executive counted as an employee. A review of participating firms found cases in which executives and high-income workers had been included among the older workers, a standard the ministry said did not meet public expectations.

The programme, run since 2011, requires participating companies to employ at least five older workers a year. Companies selected by a review committee can receive support for creating or improving working conditions for older staff — up to 200 million won ($150,602) per site for designated elder-friendly firms, or up to 300 million won ($225,904) for start-ups that hire older workers in large numbers.

Under the new rules, registered executives, senior officials, high earners and related parties with real management control will also be barred from the employment count. The ministry will strengthen checks on the job titles and duties of the older staff that companies report, and will tighten both the initial screening of employment figures and follow-up inspections.

Participating companies are also required to put up at least 30 percent of the subsidy themselves, either directly or through another company or institution. Designations run through the end of the fifth year after a company is selected.

The number of participants rose from 1,999 in 2021 to 2,916 in 2023, then fell to 2,477 as of August this year. Average monthly pay for participants climbed steadily over the same period, from 1.23 million won ($926) in 2021 to 3.09 million won ($2,325) in August. The programme had designated 19 start-up firms and 218 elder-friendly companies and institutions since 2021.

"The elder-friendly company programme is one of our quality private-sector job programmes for older people — it gives participating seniors income stability and a better quality of life, gives companies skilled staff and stronger competitiveness, and eases the fiscal burden on the government," said Choi Bong-geun, director-general for senior policy at the ministry. "We will manage the programme more closely so that it stays true to its purpose."