The government is tightening the criteria for recognizing hiring records at senior-friendly companies, after highly paid executives and high earners were counted toward quotas for a state-subsidized senior employment program. The move comes a week after The Seoul Economic Daily reported on the 14th that a company vice president earning 20 million won a month had been included in the hiring records of the program. The government plans to reapply stricter standards that had been eased to broaden corporate participation, so that subsidies lead to genuine job creation for older adults.
The Ministry of Health and Welfare said on the 21st that it will improve the designation and operating standards and the management system for senior-friendly companies, and will apply strengthened criteria for recognizing hiring records from 2027. The step follows a recent review of the program that found some companies had counted senior officials, executives and high earners toward their senior hiring records.
The Seoul Economic Daily reported on the 14th, based on data on participants in the senior-friendly company and institution program obtained through the office of Rep. Kim Yun of the Democratic Party of Korea, a member of the National Assembly's Health and Welfare Committee, that executives drawing large salaries had been included in senior hiring records. Through July of this year, 10 participants had average monthly pay of 10 million won or more, with the highest reaching 20 million won. There were no participants at that pay level in 2021 and 2022, but five were included in hiring records in 2023, 17 in 2024 and nine in 2025.
A leading example is Megagen Implant, a dental implant manufacturer. The company, which has taken part in the senior-friendly company program since 2021, registered its vice president as part of its older-worker hiring record every year from 2023 through this year. The vice president's average monthly pay was 18.61 million won in 2023, 19.07 million won in 2024 and 18.88 million won last year, rising to 20 million won this year. In June of this year, a managing director with average monthly pay of 15.83 million won was also added as a participant. Under the company's performance agreement, total subsidy support amounts to 125 million won.
Megagen Implant met its target of hiring five older workers in 2023, but one of them was the vice president. Excluding the vice president, the figure drops to four, short of the hiring target. Whether executives were counted thus directly affected whether the company met its target. At a hospital in North Gyeongsang Province, two doctors with average monthly pay of 20 million won were also found to have been registered as senior employment program participants this year.
The senior-friendly company program was introduced in 2011 to encourage private companies to hire older workers. It supports the founding of companies that employ large numbers of older workers, or covers costs such as improving working conditions at existing companies. Startup-type companies receive up to 300 million won and designated companies up to 200 million won. Companies that receive support must meet requirements including hiring at least five older workers each year. Those that fail to meet hiring targets may face measures such as clawbacks of subsidies under their contracts.
Behind the problem is a 2022 easing of the criteria for recognizing hiring records. At the time, the government changed a rule that had excluded executives and related parties — including the chief executive, their spouse and direct ascendants and descendants — from hiring records, so that only the chief executive was excluded. The aim was to reduce the burden on existing companies taking part and to encourage the hiring of highly skilled older workers.
After the rules were eased, average monthly pay for participants in the senior-friendly company program rose to 2.118 million won in 2023 and 2.782 million won in 2025, from 1.23 million won in 2021. In August of this year it reached 3.087 million won. Over the same period, the number of participants rose to 2,477 from 1,999. But as some companies counted senior officials and high earners toward their hiring records, critics said the practice ran counter to the purpose of the program.
The government will accordingly tighten the requirements for selecting senior-friendly companies and maintaining their designation from next year. In addition to the chief executive, registered executives, senior officials with effective management control, high earners, and related parties such as the chief executive's spouse, direct ascendants and descendants and siblings will be excluded from hiring records if they do not fit the purpose of the program. Authorities plan to review companies' decision-making and ownership structures and decide on recognition through deliberation by a central review committee.
Follow-up management will also be strengthened. The senior employment information system will be improved to allow periodic checks on participants' job titles, the duties they actually perform and their employment status. Authorities plan to review hiring conditions and working environments comprehensively and exclude from hiring records any participants who do not fit the purpose of the program.
The government plans to overhaul the management system for the senior-friendly company program, in which 237 companies currently take part, to improve the effectiveness of its support. The program is run with a target of newly selecting about 30 companies each year.
"The senior-friendly company program supports income stability and a better quality of life for older people, while helping companies secure skilled workers and strengthen competitiveness," said Choi Bong-geun, director general for elderly policy at the Ministry of Health and Welfare. "We will manage it more closely so that it serves its intended purpose."