Section 1: Parties and Need for Remedy
Chapter 1: Employees
2. Determination of the Existence of Executive's and Internal Subcontractor[so-sa-jang]'s Employee Status under the Labor Standards Act
2.2 Unregistered Executive
| Supreme Court Decision on November 9,2017, Case 2012da10959 (Denial of Employee Status of a Nonregistered Executive) | |||||
| * Plaintiff, Appellee, and Appellant: A
* Defendant, Appellant, and Appellee: MetLife Life Insurance Corporation 1. Facts: a. The defendant had established separate personnel regulations for executives, including both registered and nonregistered executives, outlining appointment, dismissal, compensation, and treatment, thus operating an executive system distinct from regular employees. b. The plaintiff, having previously worked as a division chief at ○○○○ Bank, was appointed as an executive officer (nonregistered) at the defendant company on December 15,2003, overseeing the "Bancassurance and Direct Marketing" division. There was no separate employment contract written between the plaintiff and the defendant. c. As the head of the Bancassurance division, the plaintiff had the authority to make autonomous decisions regarding medium and long-term business plans, volume planning, setting performance standards, executing sales promotion expenses related to operations, establishing and adjusting telemarketing sales store plans, and handling the opening, merging, and closing of stores. He exercised broad authority in the management of his division's operations and only needed the CEO's approval for significant contract signings and monthly reports. Furthermore, the plaintiff participated in the Steering Committee as an executive member of the defendant, dealing with major management issues such as long-term and short-term management plans, sharing and discussing the companywide and division specific management status, and making decisions on important management topics. d. According to the employment rules and executive personnel regulations, the status of executives and other employees at the defendant company was strictly distinguished. Employees appointed as nonregistered executives were considered retired from their employee status and received severance payments accordingly. Nonregistered executives received compensation and severance payment levels similar to those of registered executives according to the 'Executive and Auditor Compensation and Severance Payment Regulations', which was much higher than regular employees, and their benefits such as car allowances and club memberships were also provided at an executive level, thereby receiving markedly superior treatment compared to regular employees. e. On July 30, 2007, the plaintiff was dismissed from his position as executive officer responsible for the Bancassurance division due to poor performance, among other reasons, and was placed on a waiting assignment by the HR support team on August 3,2007. On May 22,2008, he was suspended from work for two months for reasons including lack of improvement efforts in sales performance, absence of leadership leading to delays in product launches and inadequate promotion, poor management capabilities facilitating the resignation of talented employees, and inhumane management practices, and finally, he was dismissed following the executive personnel committee's decision under the revised executive personnel regulations on August 1,2008. 2. Court Judgement: a. Even if an individual holds an executive position at a company, if the nature of their duties involves handling tasks delegated by the company under the direction and supervision of a managing director or similar authority, and they are compensated for these tasks, they could potentially be considered an employee under the Labor Standards Act. However, if the overall nature of the duties or the actual execution of the work does not merely involve providing labor under the direction and supervision of the employer, then the executive is considered to be in a position of handling delegated tasks and would not typically qualify as an employee under the Labor Standards Act. Especially in Case s where executives at large companies are specifically appointed to manage professional areas of business and have participated in company management decisions independently while receiving differentiated treatment from regular employees, these specific circumstances of appointment, the nature of the duties, and the treatment must be considered in determining whether they are handling tasks delegated by the company. b. In the Case where B was appointed as a nonregistered executive at a large financial institution and was subsequently dismissed, considering the size and organizational structure of the company, the nature of its operations as a major financial institution, the circumstances under which B was appointed externally as a nonregistered executive, his professional capabilities considered during the appointment, the comprehensive authority and actual performance of his duties, his participation in the company's decision-making and management, the distinction and separation in appointment between executives and employees, the significantly superior compensation and benefits B received, and the circumstances and reasons for his dismissal, it is difficult to see him as simply providing labor under the direct supervision and command of the company's directors. B was in a position where he independently managed a specific professional segment of the company's operations and had considerable autonomous authority and responsibility, thus he would not typically qualify as an employee under the Labor Standards Act. |
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| Download : 대법 2012다10959.pdf | |||||
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