2. The costs of lawsuit shall be borne by the Plaintiff.

A. The Plaintiff is a construction company established on January 1, 2006 and engaged in construction, manufacturing, and interior fisheries.

B. On August 6, 2015, the Defendant: (a) selected the Plaintiff as a workplace subject to the final settlement of employment and industrial re-insurance premium; and (b) instructed the Plaintiff to submit to the Plaintiff materials, such as financial statements confirmation Board, income statement, and account president by August 21, 2015.

C. The Defendant calculated the total remuneration by applying the labor ratio (32/100) of subcontracted construction work to the above cost pursuant to the former Act on the Collection of Insurance Premiums, etc. for Employment Insurance and Industrial Accident Compensation Insurance (amended by Act No. 14495, Dec. 27, 2016; hereinafter “Insurance Premium Collection Act”) and the Enforcement Decree of the same Act after extracting the cost of outsourcing construction omitted from the income statement, construction cost statement, etc. submitted by the Plaintiff (see attached Form 1). The Defendant determined and adjusted the amount of remuneration from the year 2012 to the year 2015. In addition, on November 30, 2015, the Defendant collected the total amount of employment and childbirth insurance premiums (including additional charges, arrears) added to the Plaintiff as follows (hereinafter “instant disposition”).

(unit: Won)

A person shall be appointed.

A person shall be appointed.

D. The Plaintiff filed an administrative appeal seeking revocation with the Central Administrative Appeals Commission, which was dissatisfied with the instant disposition, but the claim was dismissed on August 26, 2016.

[Ground of recognition] The fact that there is no dispute, Gap's 1, 2, Eul's 1 or 16 (including each number), and the purport of the whole pleadings

2. Whether the instant disposition is lawful

A. The plaintiff's assertion

The instant disposition is unlawful for the following reasons, and thus must be revoked.

(i) argument that construction is not a construction business (i)

The Plaintiff is not a corporation that runs a construction business subject to blanket application under Article 9(1) of the Insurance Premium Collection Act. Therefore, the amount may not be added to the total remuneration by applying the labor ratio to subcontracted construction costs calculated by the Defendant.

(ii)the illegality of the application of the labor ratio (ii).

Article 13(6) of the Insurance Premium Collection Act provides that when it is difficult to determine the estimated total remuneration under Article 17(1) or the total remuneration under Article 19(1), the estimated total remuneration or the total remuneration may be determined by using the labor ratio determined and publicly notified by the Minister of Employment and Labor, as prescribed by Presidential Decree. However, the Plaintiff’s actual labor cost is verified, and thus, the actual labor cost ought to be recognized as the total remuneration, not by applying the above presumption provision. Nevertheless, the calculation of the total remuneration exceeding the actual remuneration is unlawful.

3) Illegality in calculating the cost of external construction (III)

The Defendant calculated the amount to be calculated as material cost and other expenses without any ground, and included it in the total remuneration by applying the subcontract labor ratio thereto. However, most of the Defendant’s transactions as subcontracted work is merely a fact that the Plaintiff actually received materials or products from the relevant company, and thus, it cannot be deemed as the outsourcing construction cost.

B. Relevant statutes

Attached 2. The entry in the relevant statutes are as follows.

C. Determination

1) Determination as to the assertion

According to the aforementioned evidence, the Plaintiff is registered as a business operator who runs a construction business or an artificial fishery business, and the Plaintiff is fully aware of the fact that the Plaintiff actually engaged in various construction works, such as the prime contract and subcontracted construction works during the instant project period from 2012 to 2015. Therefore, the Plaintiff did not engage in construction business. Therefore, this part of the allegation to the effect that the Plaintiff cannot calculate labor costs out of the outsourcing construction costs in accordance with Article 9 of the Insurance Premium Collection Act is without merit.

2) Judgment on the argument

In calculating insurance premium under the Insurance Premium Collection Act, if it is easy to grasp the cost of direct labor by a business operator who is the original contractor, but it is difficult to compute the cost of external labor, it constitutes a case where it is difficult to determine the presumed amount of total remuneration or the total amount of remuneration under Article 13(6) of the Insurance Premium Collection Act (see Supreme Court Decision 2005Du6201, Mar. 29, 2007).

Article 13(6) of the Insurance Premium Collection Act shall apply to the Plaintiff, in light of the following: (a) construction works are conducted based on multiple subcontractings; (b) objective materials recognized as reliable, such as financial statements by subcontractor and construction cost specifications by field, etc., in order to verify the actual wage content of subcontracted construction works; (c) the Plaintiff is unable to submit objective and reliable materials; (d) the Plaintiff failed to include the cost of outsourcing construction in the financial statements; and (e) the Defendant calculated the total remuneration by extracting the cost of outsourcing construction from 2012 to 2014 based on the account ledger, tax invoice, etc. submitted by the Plaintiff; and (e) calculating the total remuneration by multiplying the said construction cost by the subcontract labor ratio. This part of the Plaintiff’s assertion is without merit.

3) Judgment on the assertion

(A) Article 9(1) of the Insurance Premium Collection Act provides, in principle, that when a construction business is conducted through multiple contracts, the original contractor shall be deemed a business owner subject to the said Act, thereby protecting disaster workers by deeming that an insurance relationship with the entire unit of business, centering on the relevant original contractor, is established even if the relevant original contractor enters into a multiple contracts. Furthermore, Articles 13(4) through (6) and 19(1) of the Insurance Premium Collection Act provide that the total amount of remuneration may be determined by using the labor ratio determined and publicly notified by the Minister of Employment and Labor, as prescribed by Presidential Decree, if it is difficult to determine the total amount of remuneration. Accordingly, Article 11 of the Enforcement Decree of the Insurance Premium Collection Act provides that the total amount of remuneration shall be the sum calculated by multiplying the total amount of remuneration paid to workers directly employed in the relevant construction project and the total amount of subcontracted works multiplied by the labor ratio of subcontracted works (see, e.g., Ministry of Employment and Labor’s announcement 201-39, 201-23137).

In the case of construction business, it is difficult to determine the total amount of remuneration in light of the fact that subcontracting and re-subcontracts are widely performed, and that it is difficult to identify and determine the total amount of subcontracting in various construction sites, it is interpreted that the Minister of Employment and Labor publicly announced the labor ratio to calculate the amount close to the total amount of wages actually paid so that the total amount of remuneration can be determined based thereon.

(B) Generally, the construction cost of a construction company is comprised of four costs of material costs, landscaping costs, outsourcing costs, and cost. Of them, “outboard cost” refers to the cost of construction works for the relevant subcontracted project where a subcontract subcontracts a part of the subcontracted project. However, according to the overall purport of each of the aforementioned evidence, the Plaintiff constitutes only material cost, labor cost, and cost, excluding “outboard cost” in the account book of profit and loss statement or specifications of construction cost during the project period in this case, and the Plaintiff submitted a tax invoice, etc. from the Plaintiff, and then the Plaintiff purchased construction materials from the Do and retailer, etc. on the account ledger and the head of the account ledger of the construction project or the head of each account constructed by the constructor registered with the construction business registration certificate. However, the Plaintiff’s purchase of construction materials from the Do and retailer, etc. on the account ledger of the construction project on the business registration certificate shall be deemed as material cost. In addition, the items falling under construction works, such as the cost of construction works on the outside week (see subparagraph 14 and evidence).

(C) As to this, the Plaintiff submitted the On-Site Work Book (see Evidence A 7) to the court during the instant trial proceeding, and asserts to the effect that the transaction company, which is not indicated in the On-Site Work Book, is merely a mere trading or delivery business entity. However, in light of the form, content, preparation process, etc. of the on-site Work Book, the testimony by the witness A alone is difficult to readily recognize the credibility of the said document, and there are no other objective materials to support it.

(D) According to the above, there are reasonable grounds for the Defendant to extract part of the Plaintiff’s trading companies based on the objective books, such as the president of the account division, from the external construction cost. To reflect this, the Plaintiff should submit objective materials, such as the construction contract, details of transactions, and tax invoice concerning each of the above construction works, to the extent that the judge can obtain confirmation and prove that it was not subcontracted. The Plaintiff did not have any assertion that it was acceptable, and the evidence submitted by the Plaintiff is either voluntarily prepared by the Plaintiff or lack of credibility.

(E) Comprehensively taking account of all such circumstances, it is legitimate for the Defendant to regard part of the Plaintiff’s transaction as an outsourcing and include it in the total amount of remuneration pursuant to relevant statutes. Therefore, the Plaintiff’s assertion on this part is without merit.

3. Conclusion

The plaintiff's claim is without merit, and it is dismissed. It is so decided as per Disposition.

Judges Lee E-mail

Judge Park Sang-hoon

A person shall be appointed.

A person shall be appointed.

A person shall be appointed.

A person shall be appointed.

A person shall be appointed.

A person shall be appointed.

A person shall be appointed.

A person shall be appointed.

A person shall be appointed.

A person shall be appointed.