A bus driver with 29 years of service lost his retirement package worth $84,000 after being fired for stealing $7 from passengers' fares.

The city of Kyoto sacked the man, who was not named, after he was filmed by a bus security camera taking ¥1,000 ($7) in 2022.

After he was denied his retirement money of more than ¥12 million, the driver sued the city but lost the case.

The verdict was overturned in his favor, with a court ruling that the punishment was excessive.

But on Thursday the Supreme Court delivered a final ruling in the city's favor, reinstating the original penalty.

It ruled that the man's conduct could undermine public trust in the system and the sound operation of the bus service.

In the original incident a group of five passengers entered the bus and paid him ¥1,150, according to the ruling.

The driver instructed the group to drop ¥150 worth of coins into a fare collection box, and accepted a ¥1,000 bill by hand and didn't report it properly.

Despite being caught on camera, he tried to deny taking the bill during a meeting with his superior.

The driver had been reprimanded several times during his career over various incidents, according to the ruling.

This included repeatedly smoking an electronic cigarette while on duty, albeit when there were no passengers on board.

The city of Kyoto hailed the decision.

"Each one of the bus drivers works alone and handles public money," said Shinichi Hirai, an official at Kyoto's public transport bureau. "We took it very seriously that embezzlement related to this area of our work took place.

"If our strict measures were not accepted, then our organization could become careless and it could result in eroding the public's trust," he said.