Browse through brief employment and labor law updates from around the globe. Contact a Littler attorney for more information or view our global locations.

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Supreme Court Abolishes “Social Norm Reasonableness” Standard for Disadvantageous Changes to Rules of Employment

Precedential Decision by Judiciary or Regulatory Agency

Authors: Yongjae Jung, Partner, and Johnny Ji Yong Hong, Associate – Kim & Chang

In principle, an employer must obtain group consent from employees through a collective decision-making process to amend the rules of employment (ROE) that could result in disadvantageous changes to working conditions that deprive employees of their vested rights and interests. The Supreme Court’s firmly established position on this has been that failure to obtain group consent in and of itself will not nullify the disadvantageous change if the change is reasonable in light of social norms, notwithstanding the potential disadvantage to employees.

On May 11, 2023, however, the Supreme Court issued an en banc decision reversing its position, holding that “…unless there are special circumstances to conclude that the labor union or employees abused their group consent right, the disadvantageous change shall not be deemed valid solely on the ground that it is reasonable in light of social norms…” (Supreme Court Decision 2017Da35588, 35595 (Consolidated) rendered on May 11, 2023).

The Supreme Court highlighted the group consent right as a significant procedural requirement and held that the proposed change being “reasonable in light of social norms” cannot justify the failure to fulfill such a procedural requirement in making disadvantageous changes to the ROE.

The Statute of Limitations Period for a Claim Seeking Damages Caused by Illegal Dispatch Can be Ten Years

Precedential Decision by Judiciary or Regulatory Agency

Authors: Yongjae Jung, Partner, and Johnny Ji Yong Hong, Associate – Kim & Chang

On April 27, 2023, the Supreme Court upheld the lower court’s decision that the applicable statute of limitations period for a claim seeking damages caused by illegal dispatch can be up to 10 years (which also happens to be the maximum limitations period for tortious acts under the Civil Code), not the statute of limitations applicable to wage claims (three years) under the Labor Standards Act. The Court’s rationale for such decision is that the damages claim filed by the subcontractor’s employees against the principal company was in fact based on a tort claim for damages. This ruling is the first of its kind that explicitly determined the statute of limitations period for a claim seeking damages caused by illegal dispatch.

Supreme Court Decision on Retirees’ Right to Expect Re-Employment

Precedential Decision by Judiciary or Regulatory Agency

Authors: Yongjae Jung, Partner, and Johnny Ji Yong Hong, Associate – Kim & Chang

In a case that raised the question of whether an employee, who reached the company’s retirement age after filing a lawsuit for confirmation of dismissal invalidation, could seek back pay, including the period after retirement, the Supreme Court ruled that the plaintiff had the right to expect re-employment as a fixed-term employee after retirement under the particular circumstances of the case. Accordingly, by affirming the lower court’s decision, the Supreme Court held that the plaintiff should be paid the amount equivalent to his wages that he would have been paid if he were rehired as a fixed-term employee after retirement.

Previously, courts have rendered conflicting decisions on this issue. However, the above Supreme Court decision has established precedent by explicitly ruling that the right to expect re-employment can be recognized based on the practice of re-employment after retirement, even if there is no explicit provision on re-employment after retirement in the company regulations.