Concept of the discrimination redress system

The discrimination redress system was newly introduced under the Act on . . . → Read More: A discrimination redress system for non-regular workers to be applied to workplaces with 100 or more employees]]> A system to redress discrimination based on the laws on protection of non-regular workers will apply to workplaces with 100 to 299 employees from July 1, 2008. The following is a summarized translation of a report of the Ministry of Labor.

Concept of the discrimination redress system

The discrimination redress system was newly introduced under the Act on Protection of Fixed-term and Part-time Employees (hereinafter referred to as ‘fixed-term employees act’) and the Act on Protection of Dispatched Workers (hereinafter referred to as ‘dispatched workers act’).

The system prohibits employers from treating non-regular workers (a worker with a fixed-term contract, a part-time worker and a dispatched workers) disadvantageously compared to regular workers (a permanent worker, a full-time worker and a directly hired worker) over wage and other working conditions without a rational reason. The system also includes a redress procedure for discriminatory treatment involving the Labor Relations Commission.

The system does not compel an employer to equally treat regular and non-regular workers in terms of all conditions of work, but only bans a disadvantageous treatment with no rational reason. In other words, a differential treatment for non-regular workers is permitted when there is a rational reason such as differences in productivity and skills.

Redress procedure only applicable to discrimination after the enforcement of laws

A worker should request a redress of discriminatory treatment only for a treatment that happened after the enforcement of the laws for his workplace. The laws do not retroactively apply to discrimination that took place before the enforcement of the laws.

Enforcement schedule of the redress system

Business or workplaces with 300 workers or more/ the state or local government agencies (public sector): July 1,2007
Businesses or workplaces with 100 to 299 workers: July 1, 2008
Businesses or workplaces with less than 100 workers: July 1, 2009
Businesses or workplaces with less than 5 workers: Exempt

How to calculate the number of employees for the enforcement schedule

For the calculation of the number of employees for the above schedule, all workers that are directly hired by a company including regular, daily-hire, part-time, fixed-term, and foreign workers should be included but workers that are not directly hired by a company such as in-house subcontract workers and dispatched workers be excluded.

Discrimination redress system for fixed-term and part-time workers

Who can apply for redress of discrimination?

To apply for the redress, he/she should be (1) a worker under the labor standards act and (2) a fixed-term or a part-time worker.

Who is banned from making discriminatory treatment?

A person who is banned from giving discriminatory treatment is an employer.

Although the act uses the same term “employer”, a distinction should be made between an “employer” who should not give discriminatory treatment and an “employer” who is a party involved in the redress procedure and has a duty to comply with a redress order.

An employer in the first category means an “employer under the labor standards act”, that is, a business owner or a person responsible for management of a business or a person who works on behalf of a business owner with respect to matters relating to workers.

Therefore, those who should not give discriminatory treatment are not only a business owner who hired a fixed-term or part-time worker but also persons who were given responsibility and authority by a business owner to determine working conditions such as wage and hours of work or to command or supervise workers for the interest of a business owner. In addition to a business owner, a chief of a sale office, a branch chief, a factory chief and a person in charge of personnel management may fall under this category of employer.

An employer in the second category is restricted to a business owner or a legal person depending upon the nature of a company.

Wage and other working conditions for which discrimination is prohibited

The scope of ‘wage and other working conditions’ comprises (1) working conditions regulated by the Labor Standards Act and (2) working conditions determined by collective bargaining agreement, rules of employment, and labor contract. These include wage, working hours, holidays, leaves, safety and health, and industrial accident compensation. If a certain matter is not included in collective bargaining agreement, rules of employment, and labor contract as a working condition, it cannot be considered as ‘wage and other working conditions’ for which discrimination is prohibited. Consequently, application for discrimination redress cannot be made for such matter.

Comparison with regular workers

To determine whether a discrimination was made against a fixed-term or part-time workers, there should be regular workers available for comparison.

Workers to compare with a fixed-term worker are those who are engaged in the same or similar jobs under a labor contract without a fixed term in the business or workplace concerned. Workers to compare with a part-time worker are full-time workers that are engaged in the same or similar jobs in the business or workplace concerned.

Disadvantageous treatment

‘Disadvantageous treatment’ means that a fixed-term or part-time worker is getting unfavorable treatment in terms of wage and working conditions compared to regular workers.

In determining whether there was disadvantageous treatment, , it is a principle to judge on the basis of comparison of detailed items of wage and working conditions of regular workers with corresponding items of those for a fixed-term or part-time worker.

Rational reason

Disadvantageous treatment and discriminatory treatment are distinct. If an employer has a rational reason in treating a fixed-term or part-time worker in a disadvantageous manner compared to regular workers, such disadvantageous treatment is justified and does not constitute discriminatory treatment. In other words, discriminatory treatment is disadvantageous treatment without a rational reason.

Procedure of discrimination redress

Application for a redress of discriminatory treatment should be made within three months from the day when the discriminatory treatment occurred. When the three months elapse, a worker’s right to apply for redress expires and therefore application made after the three months is dismissed.

Investigation, inquiry, and the burden of proof

Upon receiving the redress application, the Regional Labor Relations Commission conducts necessary investigation and inquiry into related parties without delay.

As the burden of proof falls on employers with regard to disputes relating to discriminatory treatment, he/she should prove one the following points.

- A worker cannot apply for the redress as he is not a non-regular worker.
- There are no regular worker for comparison or selection of workers for comparison was wrong.
- There was no disadvantageous treatment.
- Disadvantageous treatment had a rational reason.

Mediation and Arbitration

The Regional Labor Relations Commission can commence mediation procedures at the request of both or either of the parties concerned or by virtue of its authority during the inquiry. If the related parties file for arbitration as a result of their agreement to follow an arbitration decision taken by the Labor Relations Commission, the Commission can conduct arbitration.

The medication or arbitration should be filed within 14 days of the date on which an application was made to redress discriminatory treatments.

The mediation or arbitration decision has the same effect as conciliation reached in the courts in accordance with the Civil Procedure Act.

Decision

The Labor Relations Commission, if it judges that the treatments in question are discriminatory after ending the investigation and inquiry, issues a redress order to the employer. If it judges that the treatments in questions are not discriminatory, it makes a decision to dismiss the application for a redress.

The contents of the mediation or arbitration or of the redress order may include ‘suspending discriminatory actions, improving working conditions, such as wages, and making adequate monetary compensation’.

Objection to redress order

If a party challenges a redress order or dismissal decision by the Regional Labor Relations Commission, the party may apply for review to the Central Labor Relations Commission within 10 days of receiving the notice of the redress order or dismissal decision.

If a party objects to a review decision made by the Central Labor Relations Commission, the party may bring an administrative lawsuit against the decision within 15 days of receiving the notice of the review decision.

Measures to enforce a redress order

The minister of labor can impose by a fine for negligence not exceeding 100 million won to a person who fails to comply with the final redress order confirmed without any justifiable reason.

The Minister of Labor also can require employers to submit a status report on compliance with the confirmed redress order. A fine for negligence not exceeding five million won is imposed upon a person who fails to comply with the demand of the Minister of Labor to submit a status report without any justifiable reason.

The following articles of the LSA do not apply to a workplace with 4 or less workers.

Some of the controversies over the foreign company’s strike was whether branch managers who have higher status than frontline staff can join . . . → Read More: Can branch managers join a labor union?]]> More than 100 days have passed since the strike at Allianz Life Insurance started. Last week, management of the company fired 87 branch managers for participating in illegal strike when they are supposed to side with management as senior managers.

Some of the controversies over the foreign company’s strike was whether branch managers who have higher status than frontline staff can join a labor union and whether the labor union with such managers as members is still a lawful union.

1. Can branch managers join a labor union?

Laws relevant to this issue can be found in the following text of the Trade Union and Labor Relations Adjustment Act (TULRAA) of Korea.

Article 2 (Definitions)
For the purpose of this Act, the definitions of terms shall be as follows: 

2. The term “employer” means a business owner, a person responsible for the management of a business or a person who acts on behalf of a business owner with regard to matters concerning workers in the business;

4. ….. an organization shall not be regarded as a trade union in the cases falling in any of the following categories:
(a)In case where an employer or other persons who always act in the interest of the employer are allowed to join it.

The problem with this definition of a person who is deemed as an employer and as such should not join a union is that it is vague enough to create confusion.

The Ministry of Labor does provide an example of ”a person responsible for the management of a business” such as chiefs of factories, departments, branches, and offices. However, as shown in the case of Allianz, the persons concerned can always say that they are not “responsible for the management of a business” but only following directions of top management, regardless of the truth of such statement.

When compared to the text of the National Labor Relations Act of the United States, the vagueness of the TULRAA is more visible.  According to the American act, a category of workers called supervisors cannot join a labor union and they are;

“Any individual having authority, in the interest of the employer, to hire, transfer, suspend, lay off, recall, promote, discharge, assign, reward, or discipline other employees, or responsibly to direct them, or to adjust their grievances, or effectively to recommend such action, if in connection with the foregoing the exercise of such authority is not of a merely routine or clerical nature, but requires the use of independent judgment. (29 USC 152 (11))”

Actually, rulings made by Korean courts over eligibility of the so-called “employers”  for union membership have similar wordings as the text of the NLRA. But it would be much better for labor and management if there is a clear divide in written law over who can sit on which side of the bargaining table.. or maybe I am wrong. Labor unions may not want to see some of their potential members labelled away as employers.

2. Can a union with  ”employers as defined by the TULRAA” as members still be lawful?

The answer to the question is two-fold. Legally “NO”, actually “Quite possible”.

An often quoted court ruling over the question say that even if there are “employers” (e.g. senior executives, factory chiefs, branch managers) among union members, the union in question does not automatically lose its legitimacy as long as inclusion of such persons does not undermine independence of the union.

What the court ruling means is that, unless there is a hard evidence for independence of a union undermined by the presence of “employers” within the union, there is always a possibility for a labor union that has executives, directors, managers as union members.

So what should an employer do about this, if he/she has a such problem in one’s company?

If a labor union is still at the infancy stage, the best would be to check upon the union bylaw, and ask the labor ministry to order the union to correct the eligibility conditions so that any workers that fall under the “employer” category should be removed.

If a labor union has been around for a while, and if there is a conflict between labor and management over the presence of “employers” in the union?  This is what happened in Allianz Korea, and I guess they must have consulted some of the best legal brains in Korea to come up with a good way to handle the issue.

What did they do? They ordered the managers to withdraw from the union citing their status. When managers refused to do so, managment escalated the level of discipline step by step, and finally fired them.

Of course, I am not saying that the solution is good for the whole situation. We never know what the massive dismissal may trigger in the future.  

The following are the basic requirements for dismissal based on the labor standards act (LSA) of Korea.

1.  An employer should have a justifiable reason to dismiss a worker.

. . . → Read More: Basic legal requirements for dismissal in Korea]]>

Dismissal is one of the inevitable elements of human resource management. An employer can lessen a possible adverse impact of dismissal by complying with legal requirements dismissal.

The following are the basic requirements for dismissal based on the labor standards act (LSA) of Korea.

1.  An employer should have a justifiable reason to dismiss a worker.

Dismissal without a justifiable reason is invalid in Korea. However, the LSA does not give a definition of a “justifiable reason”.

The definition has been established by court rulings. The definition reads that a justifiable reason is one that makes it impossible for an employer to maintain employment relationship.

It sounds somewhat vague as it is a definition abstracted from numerous previous court rulings. The following list shows some specific reasons for dismissal that have been recognized by courts.

• Failure to follow instructions on job or personnel management
• Unauthorized leave of absence
• Early-leaving without approval, negligence
• Poor performance at work
• Physical or verbal violence at work
• Criminal offences outside workplace
• Obstruction of business, violation of the company rules
• Causing financial damages to the company
• Undermining the company’s reputation
• Violating work rules and safety rules
• Forging educational or professional attainment

2. Even if there is a justifiable reason for dismissal, an employer cannot fire a worker for some periods stipulated by by the LSA.

The periods are;

• temporary interruption of work for medical treatment of an occupational injury or disease and 30 days thereafter
• maternity leave and 30 days thereafter

3. An employer should give an advance notice to a worker 30 days before dismissal.

If an employer fails to give such notice, he/she should give a worker ordinary wage for 30 days instead.

The LSA states that an employer does not have to give advance notice to the following categories of workers.

• one who has been employed on a daily basis for less than three consecutive months
• one who has been employed for a fixed period not exceeding two months
• one  who has been employed as a monthly-paid worker for less than six months
• one who has been employed for seasonal work for a fixed period not exceeding six months
• one in the first three months of a probationary period

4. An employer should give a worker a notification of a reason for dismissal in writing.

This requirement was recently added through revision of the LSA. And it is something distinct from the advance notice of dismissal. An employer should notify a worker of a reason for and date of dismissal in writing, that is, written on paper.

Recently, some Korean companies were known to notify workers of their dismissal through email or text messaging. This will not be valid means of notification anymore according to the position of the Ministry of Labor based on the new requirement.

Failure to give written notification invalidates dismissal, thereby allowing a dismissed worker to bring a case of unfair dismissal.

The ban is based on the recent revision of the “Aged Employment Act” into the “Age-based Employment Discrimination Prohibition and Aged Employment Promotion Act”.

According to the revised act, employers are banned from making age discrimination in . . . → Read More: Age discrimination to be banned from March 2009]]>

The Ministry of Labor announced that age discrimination in recruitment and hiring will be banned from March 2009.

The ban is based on the recent revision of the “Aged Employment Act” into the “Age-based Employment Discrimination Prohibition and Aged Employment Promotion Act”.

According to the revised act, employers are banned from making age discrimination in recruitment and hiring from March 21, 2009.

It is also prohibited for employers to discriminate against workers on the basis of age regarding wage, welfare, education and training, assignment, transfer, promotion and dismissal. The ban on age discrimination for issues other than recruitment and hiring will take effect from January 1st, 2010.

The act also prohibits indirect discrimination by an employer who causes unfavorable results to a certain age group by taking a criteria other than age with no rational reason.

When employers take actions for the above issues but have rational reasons, those actions will not be considered as discrimination.

The rational reasons of such exception given by the act are:

• a certain age is required based on the nature of a job
• Rational differences are made in terms of wage and welfare based on length of service of individual workers
• A retirement age is established according to this act or other acts
• Employers carry out affirmative actions for employment promotion of a certain age group based on this act and other acts

A victim of age discrimination can file a complaint to the National Human Rights Commission. The Commission, after reviewing the complaint, can advise a concerned company to take a measure to redress the problem and notify the Ministry of Labor of such advice.

The Ministry of Labor, when the company does not comply with the advice and such non-compliance has been repetitious or related to a large number of victims, can issue a correction order to the company upon a victim’s request or on its own decision.

The act also stipulates penalties for each case of violation on the part of employers

• Fine up to 5 million Won for age discrimination in recruitment and hiring
• Negligence fine up to 30 million Won for not complying with a correction order by the Ministry of Labor
• Imprisonment up to 2 years or fine up to 10 million Won for dismissing, transferring, punishing or treating unfavorably a worker who filed a complaint or a suit, submitted a document, testified to a relevant authority for age discrimination

——– 

Afterthought

Right after publishing this post,  I found an article covering the same subject here.  Looks like I made a mistake of reinveting the wheel. To compensate for my mistake, I’d like to give a personal observation on the topic.

Requiring a certain age for a job in vacancy posts is still a prevalent practice in Korea. Most entry-level jobs are only for people under 30 to 35. When you are 40-something, you have no job openings except for those aimed at senior managers with, very often, requirements of Master’s degree or even doctoral degree. Many job decriptions in job posts for whitecollar workers simply say something like “only those who were born after 1970 can apply.”

I wonder whether this practice will change with the new act. Will victims – job applicants when discrimination in recruitment is at issue – take the trouble of filing complaints to the NHRC or the Ministry of Labor when the correction order, according to the act, will be mainly about the company stopping discrimination or restoring the state of a victim to that before damage?

As an enforcement decree with details on actual enforcement of the act has yet to come and the effective date is one year further, nothing can be said for sure. But I don’t think that most 40 or 50-someting Korean job candidates will go the extra mile only to watch the company pay 5 million Won fine and some more and their own time spent on complaint procedures. I guess that they will just ignore age discriminatory job posts and keep looking for others.

According to the Ministry of Labor, the checklist covers major labor law regulations that have been frequently violated by . . . → Read More: Employers’ checklist on Korean Labor Law]]>

The Ministry of Labor released a checklist on working conditions and terms of employment for employers in December 2007. The checklist, aimed at companies with 5 employees or more, includes 48 items from 7 labor-related laws.

According to the Ministry of Labor, the checklist covers major labor law regulations that have been frequently violated by small companies without a dedicated HR manager. Employers may check whether they are observing primary legal standards and thus, resolve problems through the checklist.

Though not developed specifically for foreign companies in general, the checklist may serve as a starting point for foreign start-up companies in Korea to grasp a better understanding of Korean labor law. You can read the checklist here.