1. Public en banc oral arguments in the ordinary wage litigation

The Supreme Court will be hearing en banc oral arguments in the ordinary wage litigation at 2 PM on September 5, 2013.The cases that will be heard are the two lawsuits seeking wages and severance pay by employees of an automobile parts manufacturer against their employer, and centers around the issues of whether regular bonuses should be considered as ordinary wages and whether summer vacation allowance, the traditional kimchi-making bonus, personal retirement fund stipends and other employee benefits should be considered as ordinary wages.

In particular, the Supreme Court is expected to establish clear standards for determining regularity of payments and whether the payment amounts are fixed, two of the three criteria for payments to be considered ordinary wage, that may be applied in future cases involving similar disputes.Furthermore, the Supreme Court is expected to render a clear determination of whether requesting such payments to be a part of ordinary wages where there was an explicit or an implicit agreement to the contrary between the employer and the labor union violates principles of good faith.

2. Revision to the manual for maximum time-off limit

Pursuant to the revisions to the Notification on Maximum Time-off Limit propagated on July 1, 2013, the Ministry of Employment and Labor has announced that it will apply a new manual regarding the maximum time-off limit (the “Manual”).  The core revisions to the Manual are as follows:

  1. in case of dispatched personnel from superior organizations (federation of labor unions, etc.), the superior organizations shall also be included in the definition of a labor union in the Labor Union and Labor Relations Adjustment Act (“Union Act”) and the tasks performed by the dispatched personnel will also be considered a task subject to time-off as such tasks performed by the dispatched personnel is relevant to that workplace,
  2. strikes or acts of dispute, running for public office and other tasks that cannot be considered to be in mutual interest of both the union and the employer shall not be considered subject to time-off, but actions in preparation for strikes or acts of dispute shall be considered subject to time-off,
  3. tasks such as administration of the labor union that are in the interest of both the union and the employer and are voluntarily chosen by the union and the employer pursuant to the Union Act shall also be considered subject to time-off, and
  4. definition of employees subject to time-off, which existed in the previous manual but was not provided for in the Union Act, has been deleted.