CONTENTS
- 1. Violation of the Dispatched Workers Act | Worker Dispatch Restricted by the Act
- 2. Violation of the Dispatched Workers Act | Key Contents and Compliance Requirements
- - The General Dispatch Period and Exceptions
- 3. Violation of the Dispatched Workers Act | Points to Note for Worker Dispatch Businesses
- - For the Purpose of Employment in Illegal or Unlawful Work
- - For the Purpose of Performing Work Suspended by Industrial Action
- 4. Violation of the Dispatched Workers Act | Criteria for Determining Illegal Dispatch and the Remedy Procedure
- - The Liability of the Sending Employer
- - Prohibition of Discriminatory Treatment
- - Allocation of Liability Between the Sending Employer and the Using Employer
- - Remedy Procedure from the Dispatched Worker's Position
- 5. Violation of the Dispatched Workers Act | Items to Check for Violations of the Act
- - Evidence Collection and Application for Remedy
- - Advance Risk Review from the Employer's Position
1. Violation of the Dispatched Workers Act | Worker Dispatch Restricted by the Act
Cases of violation of the Dispatch Act are occurring more frequently as the practice of using dispatched labor for the efficient operation of personnel increases.
Dispatched labor is strictly limited by the 「Act on the Protection of Dispatched Workers (hereinafter the ‘Dispatch Act’)」.
Dispatched labor, which is performed under the direction and orders of the using employer, is clearly limited in terms of permitted work and period, and going beyond this results in ‘illegal dispatch,’ which can give rise to serious legal risks for the employer, such as the obligation of direct employment, liability for damages, and criminal punishment.
In particular, as illegal dispatch in the form of disguised subcontracting and disguised service contracts frequently occurs at construction sites, manufacturing and logistics subcontracting, and IT development sites, the standards applied by the Labor Relations Commission and the courts are becoming increasingly strict.
2. Violation of the Dispatched Workers Act | Key Contents and Compliance Requirements
The Worker Dispatch Act clearly distinguishes between work for which dispatch is permitted and work for which it is absolutely prohibited.
An employer who, in violation of this, operates a worker dispatch business or receives such services is subject to imprisonment for not more than three years or a fine of not more than 30 million won.
[Work for which worker dispatch is permitted under the Worker Dispatch Act]
- Computer-related specialists, administrative, management, and financial specialists, and patent specialists
- Records clerks and librarians, and translators and interpreters
- Creative and performing artists, and film, theater, and broadcasting specialists
- Electrical engineering technicians, telecommunications technicians, drafting technicians, and the like
- Collection and related clerical work, customer-related clerical work, and personal protection and related workers
- Food preparation, travel guidance, gas station attendants, retail sales clerks, motor vehicle drivers, and the like
[Work for which worker dispatch is absolutely prohibited]
- Work carried out at construction sites
- Among cargo handling work, work in areas for which a worker supply business license has been obtained
- Seafarer work
- Harmful or dangerous work
- Dust work
- Work of medical personnel, medical technicians, and assistant nurses
- Driving work in the passenger and freight motor vehicle transport businesses
The General Dispatch Period and Exceptions
In principle, the dispatch period is one year, and it may be extended once by agreement between the parties, but even then it may not exceed a total of two years.
If, in violation of this, a worker provides dispatched labor at the same workplace for two years or more, the using employer must directly employ that worker.
However, the dispatch period may exceed two years where there is a need to dispatch older workers, to fill a vacancy due to childbirth or illness, or to secure personnel on a temporary or intermittent basis.
3. Violation of the Dispatched Workers Act | Points to Note for Worker Dispatch Businesses
Under the Dispatched Workers Act, businesses such as food service businesses under the Food Sanitation Act, lodging businesses under the Public Health Control Act, and marriage brokerage businesses may not concurrently operate a worker dispatch business.
In particular, the valid term of a permit for a worker dispatch business is 3 years, and to obtain a renewal after the valid term of the permit has ended, a renewed permit must be obtained by 30 days before the expiration date of the valid term.
In addition, if the permit under the Dispatched Workers Act was obtained by false or improper means, if a ground for disqualification of the permit applies, or in cases such as lending one's name, a violation of the Dispatched Workers Act may result in revocation of the business permit or suspension of business for a fixed period of up to 6 months.
For the Purpose of Employment in Illegal or Unlawful Work
Where worker dispatch is carried out in order to employ a person in the following work, this is a violation of the Worker Dispatch Act, and the offense is punishable by imprisonment for up to five years or a fine of up to 50 million won.
In this case, an attempt is also punishable.
- Prostitution
- Manufacture of adulterated food
- Manufacture of adulterated pharmaceuticals
- Manufacture of adulterated toxic substances
- Improper medical practice
- Sale of harmful food
- Sale of meat from diseased animals
For the Purpose of Performing Work Suspended by Industrial Action
A temporary work placement business operator may not dispatch a worker to a workplace where industrial action is ongoing in order to perform the work suspended by that industrial action.
In addition, a dispatched worker may not be used for the relevant work before two years have passed after a dismissal for managerial reasons.
However, if there is a trade union organized by a majority of the workers at the relevant workplace, the period of restriction on use may be set at six months.
4. Violation of the Dispatched Workers Act | Criteria for Determining Illegal Dispatch and the Remedy Procedure
Unlawful dispatch under the Dispatch Act is as follows.
In such cases, there are instances where dispatched workers are managed at a construction site under the guise of a subcontracting agreement or the like, and such instances are detected.
- Use of a dispatched worker for work that is not subject to dispatch
- Use of a dispatched worker in the absence of a vacancy or a temporary ground
- Use of a dispatched worker for work for which worker dispatch is absolutely prohibited
- Violation of the Dispatch Act, such as a dispatch period exceeding two years
- Use of a worker dispatched by an unlicensed dispatch business operator
- Disguised subcontracting and disguised service contracts, and the like (where the principal contractor directly directs and orders the dispatched worker)
The Liability of the Sending Employer
Whether there is a violation of the Act on the Protection of Dispatched Workers turns not on the contract's nominal title but on the actual relationship of work direction.
If a dispatched worker receives instructions directly from the using employer (the principal contractor) rather than the dispatch business operator (the dispatch company), the arrangement is, in substance, deemed to be dispatched labor.
In particular, if illegal dispatch is recognized, the principal contractor as the employer must directly employ the worker concerned, and if it refuses to do so, an application for a direct employment order may be filed with the Labor Relations Commission.
Prohibition of Discriminatory Treatment
A using employer may not discriminate against a dispatched worker, without reasonable grounds, compared with a regular worker performing the same kind of work.
If you performed the same or similar work as a regular worker but were discriminated against in all treatment, such as wages, performance pay, working conditions, and welfare benefits, you may file an application for correction with the Labor Relations Commission.
However, in this case, workplaces employing four or fewer workers are excluded from application.
An employer who has subjected a dispatched worker to discriminatory treatment is punished by imprisonment of up to two years or a fine of up to 10 million won.
Supreme Court Decision 2011Du7045, decided October 25, 2012
Whether the work of a worker performing the same or similar work within the using employer's business corresponds to work of the same or similar kind as that of the dispatched worker is judged based on the work the worker has actually performed.
Even if they do not completely match, if there is no essential difference in the main content of the work, they should be regarded as engaged in work of the same or similar kind.
Allocation of Liability Between the Sending Employer and the Using Employer
Where the business operator terminates the worker dispatch contract without justifiable reason or fails to pay the consideration for it, the dispatching business operator and the using business operator bear employer liability jointly; however, in the following cases, the dispatching business operator alone bears the liability.
Matters of joint liability of the dispatching business operator and the using business operator under the Occupational Safety and Health Act
With respect to the employer's obligations under the Occupational Safety and Health Act, the disclosure of the health examination results of an individual worker upon that worker's consent, the change of the work site and the transfer of work to maintain the worker's health, measures to reduce working hours, and the prohibition of unfavorable treatment upon reporting to a supervisory agency, both the dispatching business operator and the using business operator are regarded as the employer.
Remedy Procedure from the Dispatched Worker's Position
A worker may file a complaint with the Ministry of Employment and Labor, or file an application for a direct employment order or for correction of discrimination with the Labor Relations Commission.
In addition, a worker who wishes to contest a corrective order of the Regional Labor Relations Commission may file an application for reexamination with the National Labor Relations Commission or subsequently file an administrative litigation.
If necessary, a worker may also proceed with litigation, such as a lawsuit to confirm worker status, or make a claim for damages for unlawful dispatch or a claim for the wage difference under the employment contract.
Because a dispatched worker may also receive a retirement allowance, if a violation of the Labor Standards Act is confirmed, you should check the method of claiming the retirement allowance and the three-year extinctive prescription and respond accordingly.
5. Violation of the Dispatched Workers Act | Items to Check for Violations of the Act
A violation of the Dispatch Act gives rise to liabilities for a company such as a direct employment obligation, criminal punishment, and an administrative fine not exceeding 100 million won where a corrective order is not complied with.
From the worker's standpoint, on the other hand, where illegal dispatch is confirmed, it serves as a highly effective remedy through which the worker may demand conversion to regular employment and the correction of discrimination.
Accordingly, the lawfulness should be checked from the conclusion of a dispatch contract through the operational stage at the work site, and workers also need to keep careful records of the substantive using relationship.
Evidence Collection and Application for Remedy
To prove illegal dispatch, materials that can prove the fact of direction and orders are important.
Advance Risk Review from the Employer's Position
A company should carefully review whether it is a legitimate subcontract or service contract.
- The right to direct and order personnel is exercised independently by the subcontractor
- Prohibition of direct work instructions by the prime contractor's managers
- When using dispatched labor, review of the lawfulness of the dispatch-eligible work and period
- Written contract and notification of employment conditions
If there is a possibility of a violation, it is advisable to cooperate with an outside labor attorney and a labor-law attorney to supplement the on-site management system.
This firm's Labor and Industrial Accident Group forms a task force of attorneys and labor attorneys with experience at the Ministry of Employment and Labor, the Labor Relations Commission, and elsewhere to review the matter. If you have any inquiries related to a violation of the Dispatch Act, please make an appointment for a legal consultation.
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