LABOR CASES

Foreign Workers

Application of Labor Laws to Illegal Foreign Workers


I. Introduction

According to the statistics of the Ministry of Justice, as of December 31, 2014, the number of illegal aliens in Korea was 208,778 people, which is 11.6% of the total number of aliens (1,797,618). Chinese (excluding ethnic Koreans) are overwhelmingly the largest group at 70,311, while ethnic Korean Chinese constitute another 19,256 people. The second largest group is Thais (44,283), which is a remarkable change, since Thai illegal aliens have more than doubled from 20,665 people in December 2013 to 44,283 as of December 2014, as a result of the non-visa agreement between the two governments. The next largest are 26,932 Vietnamese; 12,814 Filipinos; 7,409 Mongols; 7,237 Indonesians; 6,627 Uzbeks; 4,309 Bangladeshis; 3,010 Pakistanis; and 3,004 Americans. Other nationalities comprise an additional 3,586 persons The number of foreign workers has increased by more than 20% every year, and along with this, the number of illegal foreign workers has also continuously grown.
The Immigration Control Act was designed to manage foreign workers strictly according to the principle of a ‘Korean-first employment policy’, and the “Act on Foreign Workers’ Employment, etc.” (hereinafter referred to as “the Foreign Workers’ Employment Act” or the “FWE Act”) was also introduced to manage the non-professional employment (E-9) of the majority of foreigners along with the visiting employment (H-2) of overseas Koreans. As the number of illegal foreign workers who have recently violated the Immigration Control Act and the Foreign Workers’ Employment Act has increased dramatically, it is necessary to understand their protection under the labor laws, and the limitations on that protection.

II. Related Laws to Restrict Illegal Aliens

1. The Immigration Control Act
The Immigration Control Act is the compulsory regulation stipulating matters concerning safe border controls through the immigration control of all nationals and foreigners who enter or depart Korea, control over the sojourn of foreigners who stay in Korea, and procedures, etc. for the recognition of refugees. Any foreigner can stay in Korea within the scope of their status and period of sojourn (Article 17). Also, foreigners intending to be employed in Korea shall attain the applicable status for employment activities, and employers may employ any person having the proper work status (Article 18). There are three kinds of work-related employment: ① non-professional employment, ② professional employment, and ③ employment through sojourn.

2. The Foreign Workers’ Employment Act
The Foreign Workers’ Employment Act was designed to promote a smooth supply to meet the demands for manpower along with a balanced development of the national economy through the systematic introduction and management of foreign workers. Foreigners to whom this Act applies are those engaged in non-professional employment (E-9) and overseas Koreans engaged in visiting employment (H-2). Foreigners hired for jobs classified as non-professional employment (E-9) use the Employment Permit System. This Employment Permit System grants permission to hire particular foreigners, after employers have unsuccessfully made an effort to hire domestic workers. After such effort, foreigners can be invited after signing a contract for employment with the particular employer. Visiting employment (H-2) has used the Employment Permit System containing the characteristics of the Labor Permit System (LPS). Through this LPS, Foreign nationality Koreans are allowed to come to Korea first and attempt to find a job within a limited time period. If they cannot find a job within that time, they must leave Korea immediately. Foreign workers may be employed up to three years from the date of their entry, and they may have their employment extended one time only by a maximum of two additional years, which means that their total period of residence in Korea can be up to five years (Article 18, Article 18-2).

3. Related judicial ruling
The Supreme Court explained the purpose for strictly controlling foreigners in violation of the Immigration Control Act as follows: “The Immigration Control Act regulates in its Article 18 (paragraph 1) that a foreigner intending to be employed in Korea shall attain the status of sojourn eligible for employment activities, and also regulates in the same Article (paragraph 2) that no foreigner having the status of sojourn under paragraph (1) shall work at any place other than the designated working place. Therefore, the purpose of this legislation was not simply to restrict the illegal stay of foreigners, but also to regulate the qualifications of eligibility for employment and block foreigners not eligible for employment so that it could protect the status of the domestic employment market from immigrating not-eligible foreign workers, manage the foreign workforce effectively, and protect domestic workers. This means that this law was enacted to directly restrict foreign workers not eligible for employment in fact.”

III. Application of Labor Laws

1. Individual employment relations
Korean labor laws apply to those who offer work to earn wages without any discrimination, according to the principle of territorial privilege for jurisdiction. If a foreign worker whose employment contract was made in his/her home country provides labor service in Korea, or if a foreign company and a foreign employee agreed that his/her home country’s labor laws would apply to his/her employment contract, excluding the application of Korean labor laws, Korean labor laws are applied in accordance with the compulsory law of a workplace in Korea providing labor service according to the Conflict of Laws Act, Article 28 (Employment Contracts).
While providing for labor service, Article 6 of the Labor Standards Act prohibits discriminative application based on an individual’s different nationality, by stipulating that “no employer shall give discriminatory treatment in relation to working conditions on the basis of nationality.” Exceptionally, regarding whether the protection of the labor laws regarding illegal foreign workers is applied or not, the Labor Ministry judged that illegal foreign workers were not subject to protection as any employment contract made by illegal foreign workers would not be in effect. However, later, as the court determined an illegal workers’ injury as occupational , and also admitted foreign trainees’ eligibility for severance pay , the Labor Ministry changed its guidelines and accepted that illegal foreign workers were subject to the protection of the labor laws.
The court clearly ruled whether the Labor Standards Act is applicable to illegal foreign workers as follows: “The regulation restricting employment of foreigners is a control act to prohibit foreigners not eligible for employment from being employed. This cannot be a regulation to restrict the legal effect of the labor right that an illegal foreign worker with no eligibility for employment has obtained by providing labor service, and the legal effect of labor laws concerning employment status. Therefore, even if a foreign worker without eligibility for employment made an employment contract in violation of the regulation restricting employment of the Immigration Control Act, it cannot be determined that the employment contract itself be regarded as clearly invalid. However, since the employment status makes it possible for a foreign worker to participate in employment activities, in a case where a foreign worker is illegal, the employment relationship should be stopped. Furthermore, both parties can always cancel the employment contract due to the absence of employment eligibility.

For further questions, please
call (+82) 2-539-0098 or email bongsoo@k-labor.com

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