Case on the Suspension of Retirement Pension Payments for Local Council Members

[29-2 KCCR 201, 2015Hun-Ma1052, July 27, 2017]

A. Background of the Case

In this case, the Constitutional Court held that the provision of the Public Officials Pension Act that suspends the payment of the entire retirement pension where an annuitant of the retirement pension under the Public Officials Pension Act is elected as a local council member (hereinafter referred to as the "Pension Suspension Provision") is not in violation of the Constitution.

The complainants, who were elected as local council members in 2014, filed a constitutional complaint when the payment was suspended in 2016 based on the Pension Suspension Provision.

B. Summary of the Decision

The Constitutional Court ruled that the Pension Suspension Provision does not infringe on the complainants’ property rights, for the following reasons.

The Pension Suspension Provision is intended for the sound maintenance and continuation of the public officials’ pension system, by making improvements to the deterioration of pension finances. The complainants cannot be not considered to be de facto “retired” because they took office as local council members and became able to continue income-earning activities, and they cannot be considered as persons under "social risk" who require protection by the pension, when taking into account the remuneration they receive as local council members; and by suspending payment of the pension, it is necessary to prevent cases where an annuitant of the retirement pension receives the double benefits of remuneration and pension from taxes paid by citizens by becoming a local council member again. Therefore, the Pension Suspension Provision cannot be considered to infringe on the complainants’ property right against the rule against excessive restriction.

As a monthly allowance has been paid to local council members since 2006, the money they receive has more strongly taken on the nature of remuneration, and the necessity to protect confidence in the past legal status has weakened due to the adjustment of such remuneration to a realistic level. It is also difficult to say that the complainants’ confidence was based on a strict legal order, because the pension system for elected public officials had been suspended a

few times before. On the other hand, the public value pursued by the Pension Suspension Provision is so significant that it cannot be considered to infringe on the complainants’ property rights against the principle of protecting confidence.

Justices Kim Chang-Jong and Seo Gi-Seog set forth an opinion of nonconformity to the Constitution.

In order to suspend the payment of pension to prevent double benefits, the prerequisite should be that there is income to replace the function of the pension. However, the average monthly allowance, which is the only remuneration that local council members receive, falls far below the median income of households with three or four family members, and is very low compared to the salaries of other elected public officials such as the members of the National Assembly, the heads of local governments, etc. In some cases, it is even lower than the amount of the retirement pension. Therefore, suspending the payment of the entire pension only on account of the fact that local council members will receive remuneration by taking office as local council members is an excessive restriction on their property rights. Provided, since the unconstitutionality of the Pension Suspension Provision lies in the uniform suspension of the payment of the entire amount of the pension, even for local council members who do not receive sufficient remuneration to replace such pension, it is appropriate to deliver a decision of nonconformity to the Constitution, respecting the legislative discretion of the legislature to eliminate such unconstitutionality.

C. Significance of the Decision

Before this decision, the joint presidency of the Nationwide Council of Heads of Si/Gun/Gus had declared that the suspension of payment of the public officials’ pension is unfair, but this decision put an end to the controversy.