In June 2016, the Seoul Southern District Court ruled in
favor of 97 former fixed-term contract employees of a broadcasting
company who had been converted to indefinite-term employees. The
employees had filed the lawsuit against the company to demand the
same employment benefits, such as a housing allowance, that were
available to regular indefinite-term employees who had not started
on fixed-terms and been converted.
The plaintiffs had initially been hired by the company as
fixed-term employees, and their contracts were extended to
indefinite-term contracts. That, in essence, provides them with the
same employment security enjoyed by other indefinite-term employees
who were not initially on fixed-terms. However, as between the
former fixed-term employees and the other indefinite-term
employees, there were some discrepancies in terms of benefits and
remuneration, including a housing allowance offered only to the
Article 8(1) of the Protection of Fixed-Term and Short-Term
Employees Act prohibits unjustified discrimination against
fixed-term employees, but this statute does not expressly cover
providing inferior terms to employees who have converted
from fixed-term to indefinite-term. As such, the parties'
arguments focused extensively on whether their converted, former
fixed-term status falls within "social status," which is
listed in Article 6 of Labor Standards Act as an impermissible
ground for discrimination.
The Seoul Southern District Court held that it did, and ruled
against the company. The court reasoned:
There is no difference, in terms of
the type, scope, volume, and difficulty of work, between the
plaintiffs and the regular [indefinite-term] employees, while the
hiring process, and the possibility of being made the head of
department or being promoted are different. The part of the
employment agreement between the plaintiffs and the company
depriving them of benefits such as the housing allowance, is in
violation of Article 6 of Labor Standards Act and thus
If this decision is upheld on appeal, indefinite-term workers
who have been converted from fixed-term contracts with restrictions
on their available benefits will be able to demand equal treatment
with other indefinite-term employees
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
To print this article, all you need is to be registered on Mondaq.com.
Click to Login as an existing user or Register so you can print this article.
Sticking to what you know in new employment may backfire when client-specific restraints protect an employer's interest.
Some comments from our readers… “The articles are extremely timely and highly applicable” “I often find critical information not available elsewhere” “As in-house counsel, Mondaq’s service is of great value”
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).