LG Electronics will introduce a "re-employment system" that continues to utilize skilled workers even after the mandatory retirement age. As Hyundai Motor and POSCO have adopted employment-extension models in succession, the likelihood is growing that they will spread across the broader industrial sector.
LG Electronics said on the 1st in an internal notice that it will introduce a post-retirement re-employment system following a wage and collective bargaining agreement with its labor union. Starting next year, employees with expertise and skills will be able to extend their employment for up to one year after retirement, considering their intent and health status. The policy applies to both office and production workers.
The move is seen as a preemptive response to social demands surrounding the use of older workers, going beyond a simple expansion of benefits. It signals a break from the previous practice of uniformly retiring employees at the mandatory age, aiming instead to retain skilled workers to ensure knowledge transfer and production stability. The judgment is that the value of on-site experience and know-how remains valid even amid the spread of artificial intelligence (AI).
The post-retirement re-employment system is already spreading, particularly in major manufacturing. Hyundai Motor and Kia have implemented re-employment for volunteers among research, production, and maintenance staff since 2019, and in 2024 extended the period to up to two years. POSCO also moved beyond its previous selective approach through last year's wage and collective agreement to expand eligibility to all retirees.
In business circles, such employment-extension models are expected to spread further, centered on large corporations. Observers say this results from the confluence of structural challenges: a shortage of skilled workers, the need to ensure production stability, and aging demographics.
Meanwhile, the labor and management at LG Electronics set this year's average wage increase at 4% in the latest bargaining round. For office workers, wages will be adjusted by adding a short-term raise based on last year's performance evaluation (0–8%) and a long-term raise reflecting performance over the past four years.
Benefits were also strengthened. The leave period for infertility treatment will be extended from the current three months to up to six months, and prenatal checkup leave will be increased from a half day to a full day.