Dispatched workers

A dispatched worker (파견근로자/派遣勤勞者) means a person who is employed by a sending employer and subject to worker dispatch under the Act on the Protection, etc., of Dispatched Workers (파견근로자 보호 등에 관한 법률).

The legislative purpose is to pursue the proper operation of worker dispatch undertakings and to establish standards for working conditions, etc., for dispatched workers, thereby contributing to employment security and welfare promotion for dispatched workers and facilitating manpower demand and supply. Article 1.

According to the Act, jobs permitted for worker dispatch shall be those considered suitable for that purpose given their nature or required professional knowledge, skills or experience, and prescribed by the Presidential Decree, except for those directly related to production in the manufacturing industry. Article 5 (1).

Key words
dispatched workers, subcontract, labor flexibility, shared growth, regular employee

Subcontracting practices
To avoid the cost increase and secure labor flexibility, most big businesses prefer the employees of subcontractors to regular staff. Until the Supreme Court decision in February 2012 explained below, such subcontracting practices (하도급관행) have be tanken for granted.

Contrary to their expections, the Supreme Court held the dispatched workers should be treated as regular staff. And the government policy to enhance the shared growth (동반성장/同伴成長) has pushed forward the conversion of dispatched workers to regular employees.

Hyundai Motors case
B.S. Choi, employed by a subcontractor in 2002, was working at a Ulsan factory of Hyundai Motors in a ‘dispatched labor’ relationship in which he was under direct command of Hyundai Motors, not his employer, in his work. After he was dismissed from his subcontracting job at Hyundai Motors in 2005, he filed a request for relief and an administrative suit following his dismissal for labor activity and other reasons. Mr. Choi filed his suit against the head of the National Labor Relations Commission (중앙노동위원회), requesting the overturning of a retrial ruling on relief for improper dismissal.

Mr. Choi claimed that Hyundai Motors, the commissioning business, was his real employer rather than a subcontractor, and that he had been wrongfully dismissed. Choi‘s claims were rejected by the courts in the first and second instances, which ruled that the subcontracting arrangement was equivalent to outsourcing and that Choi could not be regarded as having established a direct working relationship with Hyundai Motors.

Supreme Court ruling
The Supreme Court ruled that subcontractors in the automotive industry should be viewed as “dispatched workers” subject to the terms of the Act on the Protection, etc., of Dispatched Workers. The court’s first administrative division under Justice Lee In-bok upheld a trial ruling that ruled in favor of plaintiff Choi.

The Supreme Court ruled that subcontractors were also considered dispatched workers and should be viewed as full-time employees once they have completed more than two years of service saying
 * "After becoming employed by the subcontracting business, Plaintiff was dispatched to Hyundai Motors in a ‘dispatched labor’ relationship in which he was under direct command in his work, and a relationship of direct employment with Hyundai Motors was established with the company after two years had elapsed from his dispatch.
 * The original trial court was justified in ruling that Hyundai Motors dismissed the plaintiff when it denied its service relationship with Plaintiff and made it clear that it would not accept Plaintiff's work by barring his entrance to the workplace.”

E-Mart case
Shinsegae E-Mart disclosed on March 4, 2013 that it will grant regular staff status to some 10,000 employees of its subcontractors who display products at its stores. The measure comes after the Labor Ministry ruled that these workers were illegally dispatched and instructed E-Mart to directly employ them in late February.

Directly employed staff are guaranteed employment until the legal retirement age and receive bonuses and incentives just like regular staff.

The subcontractors’ employees work for an average of 25 months, but from now on they will work for longer periods under a more stable work environment. The transition will cost E-Mart about 60 billion won ($54 million) per year. In 2007, E-Mart turned 5,000 part-timer cashiers into regular employees. This time E-Mart tried to follow the Economic democratization of the Park Geun-hye government.

E-mart also added that turning cashiers into regular staff had a positive effect. The discount store chain had expected an additional cost of 20 billion won per year, but fewer cashiers quit and their work performance improved after they became regular staff.

In January 2013, Hanwha became the first of the nation’s top 10 industrial groups to upgrade the employment status for a substantial number of its non-regular workers. Hanwha said a total of 2,043 individuals of non-regular status would be elevated to regular employee status to receive benefit packages and equal promotion opportunities. The figure included those who had been hired as contracted workers but were promised to be upgraded to regular worker status after two years. More than half were women.