On September 19, 2014, the Act on Protection of Fixed-Term and Part-time Workers (“Temporary  Workers Act”) and the Act on Protection of Dispatch Workers (“Dispatch Workers Act”) were amended  to offer greater protections to non-regular workers. In particular, (i) employers will be subject  to greater economic implications if they receive a corrective order for discriminatory treatment of  non- regular workers and (ii) part-time workers will be entitled to receive compensation for any  overtime work performed.

1. Extra bite for corrective orders for discriminatory treatment

If a non-regular worker believes he or she is being discriminated in terms  of  employment working  conditions or welfare benefits, such non-regular worker may request the Labor Relations Commission  to investigate and issue a corrective order against the employer for discrimination under the  Temporary Workers Act and the Dispatch Workers Act. In the past, if an employer was found liable  for discriminating against a non-regular worker and a correction order was issued, it was widely  recognized that the corrective order only applied to the non-regular employee who raised the  discrimination claim. As a result, the receipt of a corrective order was not significant from an  overall business perspective as the employer was only expected to correct the individual claim  raised by the non-regular worker.

However, under the newly amended Temporary Workers Act and Dispatch Workers Act, if an employer  receives a corrective order for discriminatory treatment, the Minister of Employment and Labor may  review the employer’s circumstances and request that the employer apply the corrective order to all  non-regular workers that qualify. If such employer fails to accept the Minister’s request, the  Labor Relations Commission has the authority to issue another corrective order.

In addition, the Labor Relations Commission has the authority to issue a corrective order in the form of an “Order to Improve the Employment Rules and Collective Bargaining Agreement” to

change the overall employment conditions of an employer. Through such measures, if an employer is  responsible for discriminating against a single non-regular worker, the relevant corrective order  could automatically apply to all qualified non-regular workers. As a result, under the new  amendments, the consequences of discriminating against a non-regular worker could be significant  depending on the number of subject workers.

2. Punitive damages

In the past, if an employer was found liable for discriminating against a non-regular worker,  typically, the employer would only be responsible for direct, actual damages the non-regular worker  incurred as a result of discrimination.

However, under the newly amended Temporary Workers Act, an employer that is responsible for  intentional or repeated discrimination of a non-regular employee may be subject to a maximum  penalty of treble damages by the Labor Relations Commission (Article 13(2) of the amended Temporary  Workers Act). The imposition of punitive damages on repeat or intentional offenders is to mainly  reform and deter other employers from engaging in conduct similar to that which formed the basis of  the discriminatory act.

3. Compensation for overtime work performed by part-time workers

Previously, if a part-time worker was required to perform overtime work that was outside his or her  fixed working hours and the total work hours performed by such worker (including overtime work) did  not exceed the standard working hours provided under the Labor Standards Act (i.e., 8 hours per day  or 40 hours per week), the employer was not required to provide any overtime payments to the  part-time worker.

However, under the amended Temporary Workers Act, an employer must compensate a part-time worker  for any overtime work performed in addition to his or her fixed working hours even in the case  where such worker’s total working hours do not exceed 8 hours per day or 40 hours per week. The  employer must provide overtime pay equal to at least 150% of the worker’s ordinary wage.  Recognizing that many part-time workers were being forced to work outside of their fixed working  hours on a regular basis, the amendments were passed into law to discourage and deter employers  from continuing such employment practices.

4. Aftermath and potential solutions for employers

Recent amendments to the Temporary Workers Act and Dispatch Workers Act have expanded the scope of corrective orders for discrimination to the extent that employers may now face substantial  financial implications if they are found guilty for discriminating against non-regular workers  without justifiable reasonable. Accordingly, we recommend that employers thoroughly review their  worker employment conditions and welfare benefits to determine whether there are any conditions or  benefits that are different or being unreasonably withheld from non-regular workers. If there are,  we recommend that employers take a proactive approach and voluntarily address any inconsistencies  that may be interpreted as discriminatory treatment.

Employers that traditionally use a large number of part-time workers (e.g., restaurant and  distribution industries) should expect their personnel costs to increase as a result of the amended  laws. In order to minimize or effectively budget for such overtime costs, we believe employers  should regularly evaluate the general working hours and total work hours of all part-time workers  and determine whether additional workers should be hired or a more effective work shift system needs to be developed.