Labor Standards Act | A Case Holding That the Mandatory Closing Day for Large Retail Stores Is Not a Statutory Holiday Relieving Employees of Their Duty to Provide Labor

- A holiday cannot substitute for another holiday, so for a lawful holiday substitution to be established, Day B must be a working day.

- However, because the mandatory closing day under the Distribution Industry Development Act is a “holiday” rather than a working day, designating that holiday as a substitute holiday is unlawful and void.

- Therefore, the defendant must pay the unpaid holiday work allowances for work performed on public holidays.

- The “company-wide employee representative” who reached the holiday-substitution agreement with the defendant company is not the “employee representative” prescribed by the Labor Standards Act.

First is the question of whether the mandatory closing day is a “holiday” for the employees.

Under the Distribution Industry Development Act, the mandatory closing day does have the effect of contributing to the protection of employees’ right to health by prohibiting sales to customers.

However, employees’ right to health is not necessarily promoted or enhanced only by interpreting the mandatory closing day as an additionally granted statutory holiday.

It is also not a holiday that relieves the employees of their duty to provide labor “as between the employer and the employees.” In particular, the mandatory closing day does not constitute either a contractual holiday or a statutory holiday.

In addition, granting two additional statutory holidays each month only to employees of large retail stores and quasi-large-scale stores would be disproportionate and unfair to employees of other stores.

As to whether the company-wide employee representative who reached the holiday-substitution agreement with the defendant held lawful qualification, the court likewise took the position that the qualification was lawful.

The defendant’s employees had already, on their own initiative, elected workplace employee members, the workplace employee members elected the workplace employee representatives, and the workplace employee representatives elected the company-wide employee representative. Accordingly, the company-wide employee representative can be regarded as having democratic legitimacy.

In addition, the fact that the company-wide employee representative holds the authority of an employee representative under the Labor Standards Act is set out in the operating rules of the labor-management council, and those operating rules were also kept on hand and made known at each workplace.

In particular, with respect to the gathering of opinions and the notices conducted around the time of the holiday-substitution agreement, the company-wide employee representative had continuously reached holiday-substitution agreements from around 2012 and had given notice of this fact to all employees by email.

Finally, apart from the company-wide employee representative, there is no separate counterpart with whom the defendant company could consult on matters prescribed by the Labor Standards Act, such as the flexible working hours system, the selective working hours system, restrictions on overtime work, and the compensatory leave system.