Section 1: Parties and Need for Remedy
Chapter 3: Entity Eligible for Remedy and Need for Remedy, etc.
5. Business Closure and Need for Remedy
5.2 Recognition of Need for Remedy in Case of Partial Business Closure
| Seoul Administrative Court, May 19, 2006, Decision No. 2005guhap30181 | |||||
| * Plaintiffs: Jo ○○, Lee ○○
* Defendant: ○○ Facilities Management Foundation * Defendant Intervenor: Bugguk Development Corporation 1. Facts: a. The intervenor, a foundation under the Seoul Metropolitan Government employing about 1,800 employees, temporarily managed the Yemi Botanical Garden Office after the ownership of the Yemi Botanical Garden was transferred to Seoul City by Sampung Construction Co., Ltd. as an alternative to compensation payments. Plaintiff Jo ○○ joined the Yemi Botanical Garden Office branch on September 1, 2001, and plaintiff Lee ○○ on May 2, 2001, both signing three-month labor contracts as daily-wage workers under the labor system improvement plan and the 2001 labor operation plan established on January 30, 2001; Jo ○○ worked as a plant caretaker and Lee ○○ as an environmental cleaner. b. The plaintiffs worked as temporary laborers in plant management and environmental cleaning, with their labor contracts being renewed every three months. Over the years 2002 and 2003, plaintiff Jo ○○ renewed his contract 11 times and plaintiff Lee ○○ 12 times. c. Even though classified as daily-wage workers, if employed for over a year, the intervenor paid them monthly vacation pay every three months and annual vacation pay and severance pay annually. d. In October 2004, when the number of daily-wage workers exceeded limits, the intervenor conducted performance evaluations and notified four employees, including the plaintiffs, who received the lowest ratings, that their employment contracts would expire on December 1, 2004. The plaintiffs claimed that this notification of contract expiration constituted unfair dismissal and applied for remedy at the Jeju Regional Labor Commission, which was rejected, and the Central Labor Commission also dismissed their appeal on September 7, 2005. e. Around February 2005, the intervenor transferred the Yemi Botanical Garden part of its business to Bugguk Development Corporation, which has been managing the botanical garden since April 19, 2005. 2. Court Judgment: a. Judgment on the Need for Remedy: The intervenor has not ceased all its operations but has only closed the business related to the Yemi Botanical Garden, leaving other business operations ongoing. In Case s of business transfer, employees have the right to refuse the transfer of their employment to the new owner. As noted earlier, the plaintiffs desire reinstatement with the intervenor. Therefore, even though the intervenor can dismiss workers who refuse the transfer of employment for managerial reasons, the mere fact that part of the business was closed does not eliminate the possibility of restoration to their original positions. Hence, it cannot be said that the plaintiffs' need for remedy has ceased simply because part of the business was closed. b. Legality of the Retrial Judgment: In the Case of fixed-term employment contracts, the employment relationship between the parties naturally terminates when the specified term ends unless there are special circumstances, without the need for any separate actions such as dismissal by the employer. However, there are exceptional Case s where short-term contracts are renewed repeatedly over a long period, making the specified term effectively nominal. In such Case s, even if the workers are originally employed for a fixed term, they become practically indistinguishable from non-fixed-term employees. If an employer unjustifiably refuses to renew such contracts, it is equivalent to dismissal and deemed invalid. To argue that the employment contract is effectively indefinite, despite what the contract explicitly states, the content of the contract, the motivations and circumstances under which it was formed, the purpose of specifying the term, the genuine intentions of the parties, industry practices regarding similar employment contracts, and labor protection regulations must be considered comprehensively to recognize the specified term as merely nominal. As seen before, the plaintiffs and the intervenor entered into three-month contracts that were renewed multiple times11 times for plaintiff Jo ○○ and 12 times for plaintiff Lee ○○. Despite these circumstances, considering factors such as the seasonal nature of the work at the Yemi Botanical Garden, which the intervenor temporarily managed, and the need to employ a certain number of contract or daily-wage workers during the less busy winter months, it is difficult to view the specified terms in their employment contracts as merely nominal. Therefore, the employment relationship between the plaintiffs and the intervenor ended upon the expiration of their contracts. Thus, even if the intervenor notified the plaintiffs of the contract expiration around the time it ended, this notification does not constitute unilateral termination of employment akin to dismissal. Consequently, the retrial judgment, which reached the same conclusion, is legal. Therefore, the plaintiffs' claim for its cancellation is dismissed without merit. |
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