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Newsletter | April 2017, Issue 1
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LABOR & EMPLOYMENT
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Former Fixed-Term Employees May Challenge Their Former Employers’ Discriminatory Practices Before the Labor Relations Commission
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The Protection of Fixed-Term and Part-Time Employees Act (the "PFPEA") allows a fixed-term or part-time employee to file a request with the Labor Relations Commission for relief from discriminatory treatment.1 On December 1, 2016, the Supreme Court of Korea held that even former fixed-term employees may file requests with the Labor Relations Commission seeking corrective orders against their previous employers for discriminatory practices.2
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Case Details:
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The above-referenced Supreme Court case involved fixed-term instructors (the “Fixed-Term Employees”) at a privately-operated driving school (the “Employer”). The Fixed-Term Employees alleged that they were discriminated against as compared to regular employees regarding salary and other benefits.
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Labor Relations Commissions’ Rulings:
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The Fixed-Term Employees filed a claim with the Regional Labor Relations Commission (“RLRC”) seeking a corrective order against the Employer. The RLRC ruled in favor of the Fixed-Term Employees. Subsequently, on appeal, the Central Labor Relations Commission (“CLRC”) confirmed the RLRC decision. However, prior to the CLRC's decision, the Fixed-Term Employees' employment with the driving school expired.
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First Appeal to the Trial Court:
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The Employer disagreed with the CLRC’s corrective order that required it to provide monetary compensation to the Fixed-Term Employees due to its discriminatory practices. The Employer then appealed the decision to the trial court (Seoul Administrative Court). The Seoul Administrative Court held for the Employer, stating that the Fixed-Term Employees’ standing to seek relief for discriminatory practices had been extinguished, because the employment relationship had terminated during the RLRC and CLRC dispute process.
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On Second Appeal & Korean Supreme Court’s Confirmation:
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On appeal, the Seoul High Court emphasized the legislative intent of the PFPEA: to clear and correct employee disadvantages from an employer's discriminatory practices, and to strengthen the protection of such employees’ working conditions.
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Further, the Court stated that since the PFPEA is not intended to reinstate an employee to employment or to guarantee him/her a fixed-term contract, the expiration of the fixed-term employment has no direct bearing to review and correct an employer's discriminatory practices.
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Therefore, the Seoul High Court overturned the trial court’s decision, and the Supreme Court of Korea subsequently confirmed the Seoul High Court's ruling.
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Significance:
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A fixed-term employee who is engaged in identical or similar tasks to those performed by regular employees may file a claim with the RLRC to seek a corrective order. This includes an order requiring the employer to pay monetary compensation, where fixed-term employees are discriminated against without any reasonable basis with respect to salary, bonus, incentives, welfare, benefits, and other key working terms and conditions.
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However, realistically, it is not easy for fixed-term employees to challenge their employer's discriminatory practices, considering the employees' likely desire to have their contracts renewed. Thus, this holding may provide another avenue for employees to challenge such practices, that is, after the end of their employment.
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As such, we believe more claims are likely to be filed by former fixed-term employees with the RLRC against their former employers alleging discriminatory employment practices.
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Considerations:
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In light of the above, we believe it would be prudent for employers who employ fixed-term employees to check for the following:
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Whether fixed-term employees and regular employees are co-mingled to carry out identical or similar job-tasks.
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If so, identify whether any differences exist in monetary compensation, as well as welfare and benefits between fixed-term employees and regular employees.
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To the extent required, improve the company's internal HR system, revise relevant rules and policies, and align company practices with the PFPEA requirements accordingly.
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Supreme Court Decision 2014Du43288
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Back to Main Page
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