SOUTH KOREA Law and Practice Contributed by: Sihoon Yang, Young Min Kim, Jung Mo Hong and Douglas Hwang, Yoon & Yang LLC
8. Disputes 8.1 Wrongful Dismissal
of – or procedures/formalities for – mutually agree - ing to terminate the employment relationship, as long as the termination is based on the employer’s and employee’s free will. Ordinarily, however, an employ - ee voluntarily submits a letter of resignation to the employer, and the employer accepts such letter of resignation by the employee to terminate the employ - ment contract. The Labor Standards Act does not govern voluntary terminations of employment based on the free will of both the employer and employee. Although the Labor Standards Act does not have any restrictions on employers and employees terminating their relation - ship through a mutual agreement, the South Korean Supreme Court deems termination agreements to be invalid if such mutual agreement was not a product of the employee’s genuine intent. 7.5 Protected Categories of Employee Article 23 (2) of the Labor Standards Act protects an employee from dismissal when: • they are on leave for medical treatment of an occu - pational injury or disease and within the 30 days immediately following their return to work; and • when an employee is on maternity leave and within the 30 days immediately following their return to work. However, the foregoing protections do not apply if the employer has paid lump-sum compensation to the relevant employee in accordance with Article 84 of the Labor Standards Act, or if the employer is no longer able to continue its business. The Labor Standards Act does not have provisions relating to dismissals, etc, of an employee represent - ative. However, if the collective agreement (or other similar agreement) requires the employer to obtain the trade union’s consent to dismiss an employee representative or a union member, then the employer must comply with such requirement. Otherwise, the employer’s actions against the relevant employees are deemed invalid pursuant to South Korean Supreme Court precedents.
An employee may make a wrongful dismissal claim by: • filing a civil suit for invalidation of the dismissal and disputing whether the dismissal was justified; and • petitioning for wrongful dismissal relief from the local Labor Relations Commission (the “Local Commission”). The civil suit for invalidation of dismissal and petition for wrongful dismissal relief are two independent sys - tems. Therefore, an employee may choose to proceed with either or both of the systems. Civil Suit When an employee proceeds with the first of the two above-mentioned options and subjects the dismiss - al to a dispute, then the court of first instance must decide as to the validity of the dismissal. Both the employer and employee may challenge the court of first instance’s decision by filing an appeal within two weeks from the date the written court decision was served to the relevant party. If either of the parties wishes to challenge the decision rendered by a High Court or a panel of district court judges acting as a court of second instance, then the parties must file an appeal to the Supreme Court within two weeks from the date the written decision was served for a final and conclusive judgment. Petition for Relief If an employee proceeds with the second option, then the petition for relief must be filed with the Local Commission within three months from the date the employee was dismissed. Once the petition for relief is filed, the Local Commission determines whether the employer was justified in dismissing the employee. Article 31 of the Labor Standards Act provides that both the employer and employee may challenge the Local Commission’s decision by submitting a request for a new examination to the National Labor Relations Commission (the “National Commission”) in accord - ance with the Labor Relations Commission Act within ten days of being notified of the Local Commission’s decision.
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