[1] Matters to be considered in relation to the succession of labor relations arising from corporate division

[2] Whether the labor relationship of workers engaged in a business subject to division due to corporate division is comprehensively succeeded to the newly incorporated company (affirmative in principle)

[3] The validity of a personnel order issued by an employer without granting a reasonable period required to exercise the right to refuse when a company is divided to an employee subject to comprehensive succession (=negative)

[1] In a case where the status of a party to a labor relationship is changed due to corporate division, seeking the protection of the existence of a labor relationship by comprehensive succession of a newly established company refers to the formation of a labor relationship with an employer who cannot be deemed completely identical with the other party to the existing labor contract. This can be faithful to the protection of the existence of a labor relationship. However, from the perspective of the freedom of contract that forms a legal relationship with a party’s free decision-making, in substance, it may be against the principle of self-determination by bringing about the same result as compulsory labor relationship with an employer who did not freely choose a worker. Therefore, when a company is divided, the issue of succession of a labor relationship should be resolved so that the protection of the existence of a labor relationship

[2] The personnel rights related to the conversion of ordinary workers in Korea are mostly exercising considerable discretion, and when a company operating multiple businesses dividess a specific business part as part of the restructuring in order to overcome business crisis, if the newly incorporated company goes bankrupt without overcoming business crisis, the company can have the effect of closing the specific business part without undergoing the management dismissal procedure under the Labor Standards Act, in the case where the company which used the company due to the corporate division is changed to a newly incorporated company, it is consistent with the exclusive nature of the labor relationship in which the employee's intent is to be appropriately reflected because it is not much different from the change of the employer, and it is a labor relationship due to the corporate division, and it is reasonable to give priority to the effect of comprehensive succession by law rather than the intention of the party whose transfer is restricted, unlike the specific succession, is comprehensively succeeded to the labor relationship of the newly incorporated company in principle, and in the case where the employee exercises the right to refuse, it shall be excluded from the succession of the employee's labor relationship.

[3] In principle, in order to guarantee workers' right to refuse, an employer shall grant a reasonable period necessary for exercising the right to refuse to workers to workers who are subject to comprehensive succession. If an employer does not grant workers a reasonable period necessary for exercising the right to refuse to refuse, this is null and void since the employer infringes on workers' right to own decision, and the period shall be extended by a reasonable period necessary for exercising the

[1] Articles 530-2 (1) and 530-10 of the Commercial Act / [2] Articles 530-2 (1) and 530-10 of the Commercial Act / [3] Articles 530-2 (1) and 530-10 of the Commercial Act

Suwon Automobile Sales Co., Ltd. (Law Firm Geosung, Attorneys Song-seok et al., Counsel for the plaintiff-appellant)

The Chairperson of the National Labor Relations Commission

Intervenor 1 and 196 others (Attorney Kim Jong-chul, Counsel for the intervenor-appellant)

August 21, 2008

1. All of the plaintiff's claims are dismissed.

2. The costs of lawsuit are assessed against the Plaintiff, including the part resulting from the supplementary participation.

The decision made by the National Labor Relations Commission on October 26, 2007 with respect to an application for reexamination of unfair ex officio relief between the Plaintiff and the Intervenor joining the Defendant listed in the annexed Table 1 (hereinafter referred to as the “ Intervenor”), 16 workers listed in the annexed Table 2, 2007 and the total number of workers 213 workers shall be revoked.

1. Status of parties and circumstances leading to the decision on retrial;

The fact that the court below's decision on May 28, 2007 on December 29, 2006, the number of 1,500 full-time workers in Bupyeong-gu, Incheon Metropolitan City (attached Tables 1 and 2), which was included in the main sentence, is unfair recognition of the contents of the decision on May 28, 2007 (the cancellation of the retirement order and payment equivalent to wages), which was unfair recognition of the contents of the decision on May 28, 2007 (the number of the court below's decision on April 207, 2007, the case number of the first instance court (the Incheon Regional Labor Relations Commission), which was not determined on October 106, 2006, the retirement date of the employee in charge of the automobile sales, and the reason for retirement, was dismissed on October 207, 2007, the case number of the National Labor Relations Commission (the National Labor Relations Commission's decision on October 26, 2007).

2. Whether the decision on retrial is lawful.

A. The plaintiff's assertion

(1) The concept of corporate division, which is the object of “merger”, is divided into two or more companies, and the legal effect of which the rights and obligations of the company before the division take place after the division. Article 530-10 of the Commercial Act explicitly states that the succession of labor relations following the division is recognized as a comprehensive succession as in the same way as that of the merger. However, there is no separate provision in the Commercial Act and relevant Acts and subordinate statutes regarding the succession of labor relations due to the division. As a natural legal effect of the division, unless the succession of an employee is excluded in the division plan, etc., a labor relationship belonging to the divided division shall, in principle, be deemed to be succeeded to the newly established company due to the division, regardless of the consent of the individual employee. Accordingly, even in the case of the Plaintiff, the labor relationship with the newly established company (hereinafter “instant employee”) shall be comprehensively transferred by the newly established company (DW&D Sales Co., Ltd.) and a retirement allowance for the said employee shall also be paid by the newly established company.

(2) In the case of a “transfer” which is engaged in the business of a company upon termination of a labor contract with an original affiliated company and by concluding a new labor contract with another company, it becomes effective with the consent of the relevant employee in that it is an agreement on the labor contract between the previous employee and a new one which is to be transferred, or a new one which is to be transferred the status of the employer under the labor contract. However, in the case of a corporate division, there is a clear difference in that the labor relationship is bound by the provisions of the Commercial Act without the interruption of the labor relationship, and thus, the relevant employee’s consent cannot be deemed to require the relevant employee’s consent even in the case of a transfer of

(3) In the case of a transfer of business, an enterprise organized by a certain business purpose, i.e., transferring a human and material organization as a whole while maintaining its identity, and as such, the legal nature of the transfer of a business or material organization specified by a juristic act constitutes a specific succession to rights and obligations. Therefore, in such a case, an employee who has worked in a business section subject to transfer under Article 657(1) of the Civil Act may actively express his/her intention to refuse to succeed to the employment relationship to the employer who transfers the employment relationship, and maintain the employment relationship with the existing employer. However, in the case of a division of company, the business subject to division is a "general succession" that is transferred to the incorporated company and the succeeding company at one time without the need to refrain from transferring the individual rights and obligations. Thus, since the labor relationship of the business section subject to division is comprehensively succeeded, there is no room to apply Article 657(1) of the Civil Act under the premise

(4) Specifically examining the employment relationship of workers in the case of division of a company, the division of a company may be divided into two or more categories: (i) the workers engaged in the division of a company; (ii) the workers engaged in the division of a company; (iii) the workers engaged in the division of a company; and (iv) the workers engaged in the division of a company who do not engage in the division of two or more business; and (iii) the workers engaged in the division of a company who are not engaged in the division of a company. The type of a division of a company is, in principle, succeeded to the labor relationship in accordance with the purport of the division system; and (iv) where there is a comprehensive defense as to the refusal of succession to a labor relationship with the relevant workers, it is impossible to determine the division of a company. In the case of the instant workers, a labor contract was concluded with the Plaintiff on the premise that they work in the division of a company; and (iv) the direct seller was employed only in the sales division of the company before the division of the company; and (iv) the Plaintiff’s right to participate in the division of the company is recognized as one type.

(5) In light of the following: (a) there was no change in the work and working conditions of the instant workers due to the instant corporate division; (b) the direct sales division of the Plaintiff company transferred to a newly incorporated company, the Plaintiff’s refusal to succeed to labor relations does not have any work to the Plaintiff; and (c) the business activities of the other sectors, such as direct sales and commercial sales, are entirely different from the business activities of the Plaintiff; and even prior to the instant corporate division, there was no employee transfer between the automobile sales division and any other business division; and (d) even before the instant corporate division, between the Plaintiff and the instant employees, even if the labor relationship between the Plaintiff and the instant employees was succeeded to the newly incorporated company, it cannot be deemed that the instant workers’ freedom to choose an occupation was infringed.

(6) From September 206, prior to the determination of the division of the company, the Plaintiff notified the instant workers of the scheduled fact that the company will be divided through an interview with the executives of the National Metal Workers’ Union (which is a general trade union whose organization covers employees engaged in nationwide metal-related industries; hereinafter “this case’s Trade Union”) and an explanatory meeting, etc., and sufficiently inform the instant workers of whether they would raise an objection to the succession of labor relations arising from the division of the company, such as conducting negotiations on the ground of the instant union and the division of the company. Furthermore, it is difficult to view the instant labor union as the date of the instant objection to the effect that the Plaintiff did not establish or close the company as long as the Plaintiff continues to engage in GM treatment motor vehicle sales business, and that the Plaintiff would not have reached an agreement to guarantee the employment of employees of the newly established company upon the occurrence of the issue of the establishment of the company. However, the Plaintiff rejected the instant labor relationship from September 29, 2006 to the same 3rd’s general meeting of shareholders.

On the other hand, as long as there is no separate delegation from an individual employee on whether to succeed to a labor relationship according to a company division under the legal principles of individual labor relations, the labor union to which the employee belongs cannot be deemed to have the right to consent. Thus, the employee of this case cannot be deemed to have expressed his intent to refuse to succeed to a labor relationship on the ground that the labor union of this case filed an objection prior to the expiration of the period for filing an objection. Therefore, on October 12, 2006, the following day after the registration of the company division was completed by the employee of this case after the expiration of the period for filing an objection, the Plaintiff cannot be deemed not to have reflected his opinion on the succession to a labor relationship due to the company division of this case. Rather, the employee of this case should be deemed to have explicitly consented to the succession to a labor relationship due to the company division of this case.

B. Relevant provisions

【Civil Code

Article 657 (Transferability of Rights and Duties)

(1) An employer shall not transfer his right to a third person without consent of the worker.

(2) A worker shall not make a third person provide his labor in lieu of himself without the consent of the employer.

(3) When one of the parties has violated the provisions of the preceding two paragraphs, the other party may terminate the contract.

/ Commercial Act

Article 530-2 (Division or Division and Merger of Company)

(1) A company may be divided to form one or more new companies.

(2) A company may merge with one or more existing companies after its division (hereinafter referred to as "merger after division").

(3) A company may be divided to form one or more new companies, which, in succession, may merge with other existing companies.

(4) A company after dissolution may be divided or merged after division only when an existing company becomes the surviving company or a new company is to be incorporated by such division or merger after division.

Article 530-3 (Approval for Division Plan and Written Agreement of Merger through Division)

(1) Where a company divides or merges through division, it shall prepare a division plan or written agreement for division and obtain approval from the general meeting of shareholders.

(2) A resolution for approval under paragraph (1) shall be made in accordance with Article 434.

(3) Shareholders referred to in Article 370 (1) shall also have voting rights to a resolution referred to in paragraph (2).

(4) The summary of a division plan or a contract for division and merger shall be stated in the notice and public notice under Article 363.

(5) Where a company which issued several classes of shares comes to inflict a loss on a class of shareholders due to division or a merger through division, the division or the merger through division shall be subject to a resolution by the general meeting of such shareholders under Article 435.

(6) Where the burden of shareholders of each company related to a division or a merger through division is increased due to such division or merger through division, the consent of all such shareholders shall be required in addition to the resolution under paragraphs (2) and (5).

Article 530-4 (Incorporation of Company by Division)

(1) The provisions of Section 1 of this Chapter concerning the incorporation of a company shall apply mutatis mutandis to the incorporation of a company under Article 530-2.

(2) Notwithstanding the provisions of paragraph (1), a company to be incorporated through division may be so incorporated even through investments made only by the company to be divided. In such cases, the provisions of Article 299 shall not apply where the shares of the company to be incorporated are issued to the shareholders of the company to be divided in proportion to their shares.

Article 530-5 (Entries in Division Plans)

(1) Where a company is to be incorporated through division, the following matters shall be entered in the division plan:

1. Trade name, purpose, location of principal office and method of public announcement of the company to be incorporated;

2. Total number of shares to be issued by the company to be incorporated and per share;

3. The total number, classes, and number of shares by type issued by the company at the time of division;

4. Matters concerning the allotment of shares by the company to be incorporated to the shareholders of the company to be divided, and the merger or split of shares pursuant to such allotment, if so determined;

5. The amount payable to the shareholders of the company to be divided, if so determined;

6. Matters concerning the capital and reserve of the company to be incorporated;

7. Property and its value to be transferred to the company to be incorporated;

8. Matters determined pursuant to Article 530-9 (2), if any;

9. Where directors and auditors of the company to be incorporated have been appointed, their names and resident registration numbers;

10. Matters to be entered in the articles of incorporation of the company to be incorporated.

(2) Where a company survives after division, the following matters shall be entered in the division plan:

1. The amount of capital and reserve to be reduced;

2. Ways to reduce the capital;

3. Property transferred due to division and the value thereof;

4. The total number of shares issued after the split;

5. Where the total number of stocks to be issued by a company are reduced, the total number, class and number of stocks by type to be reduced.

6. Other matters which cause any changes in the articles of incorporation.

Article 530-6 (Entries in Written Agreement of Merger through Division)

(1) Where part of a company to be divided merges with another company and the other company (hereinafter referred to as "party to merger through division") survives, the following matters shall be entered in the written agreement of the merger through division:

1. Where the company of the other party to merger through division increases the total number of stocks to be issued due to the merger through division, the total number, type, and number of stocks by

2. The total number and classes of new shares and the number of shares by type issued by the other party to the merger through division;

3. Matters concerning the allotment of shares by the other party to merger through division to the shareholders of the company to be divided, and the merger or split of shares pursuant to such allotment, if so determined;

4. If the other party to the merger through division determines the amount to be paid to the shareholders of the company to be divided, such provision;

5. Matters concerning the total amount of capital and reserve of the company to increase the other party to merger through division;

6. Property which the company to be divided transfers to the other party to the merger after division and its value;

7. Matters determined pursuant to Article 530-9 (3), if any;

8. Date of a general meeting of shareholders to make a resolution under Article 530-3 (2) in each company;

9. Date of merger through division;

10. When directors and auditors of the other party to merger through division have been appointed, their names and resident registration numbers;

11. Other matters which cause the modification of the articles of incorporation of the other party to merger through division.

(2) Where part of a company to be divided merges with another company or its part through division to incorporate a company, the following matters shall be entered in the written agreement of the merger through division:

1. Matters provided for in Article 530-5 (1) 1, 2, and 6 through 10;

2. The total number, class, and number of shares by type issued by the company to be incorporated in the course of merger after division;

3. Matters concerning the allotment of shares by the companies concerned to their shareholders, and provisions concerning the merger or split of shares pursuant to such allotment, if so determined;

4. Property and its value to be transferred to the company to be incorporated;

5. The amount payable to the shareholders of each constituent company, if so determined;

6. Date of a general meeting of shareholders to make a resolution under Article 530-3 (2) in each company;

7. Date of merger through division;

(3) The provisions of Article 530-5 shall apply mutatis mutandis to the entry of the part which is not subject to the merger through division of each company in cases falling under paragraphs (1) and (2).

Article 530-7 (Public Notice of Division Balance Sheets, etc.)

(1) The directors of a company to be divided shall keep the following documents in the principal office from two weeks before the general meeting of shareholders is held under Article 530-3 (1) to six months after the registration of division or the merger through division is effected:

1. A division plan or written agreement;

2. Balance sheet of the part divided;

3. The balance sheet of the company of the other party to merger through division.

4. A document stating the grounds for the allocation of shares to be issued to the shareholders of the company to be divided;

(2) The directors of the other party to a merger through division under Article 530-6 (1) shall keep the following documents in the principal office from two weeks prior to the date set for the general meeting of shareholders approving the merger through division to six months after the registration of the merger through division:

1. Agreements of the agreement;

2. Balance sheet of the part of the company to be divided; and

3. A document stating the grounds for the allocation of shares to be issued to the shareholders of the company to be divided;

(3) The provisions of Article 522-2 (2) shall apply mutatis mutandis to the documents under paragraphs (1) and (2).

Article 530-8 (Account concerning Division and Merger through Division)

Where a company established through a division or a merger through division or a company of the other party to a division and merger acquires business rights, the acquisition value thereof may be accounted on the assets side of the balance sheet. In such cases, not less than five years shall be depreciated equally for each period for the settlement of accounts within five years after the registration of establishment

Article 530-9 (Liability of Company after Division and Merger through Division)

(1) The company that is incorporated after division or merger after division or the company that survives after division shall be jointly and severally liable for the obligations of the company before division or merger after division.

(2) Notwithstanding the provisions of paragraph (1), where a company to be incorporated by division is determined by a resolution pursuant to the provisions of Article 530-3 (2), only the liabilities of the invested property of the company to be incorporated may be borne by the company to be incorporated. In such cases, where a company to be incorporated survives after division, only the liabilities that the company to be incorporated is not required by the company to be incorporated

(3) In cases of merger through division, the company to be divided may determine by a resolution under Article 530-3 (2) that the company shall assume only the liability for the invested property from among the liabilities of the company to be divided, which is an existing company which receives investments following the merger through division. In such cases, the provisions of the latter part of

(4) Articles 439 (3) and 527-5 shall apply mutatis mutandis to the cases under paragraph (2).

Article 530-10 (Effect of Division or Merger through Division)

A company to be incorporated through division or merger through division or a company surviving division shall succeed to the rights and obligations of the company to be divided in accordance with the written plan or agreement of division.

Article 530-11 (Provisions Applying Mutatis Mutandis)

(1) The provisions of Articles 234, 237 through 240, 329-2, 440 through 444, 526, 527, 528 and 529 shall apply mutatis mutandis to division or a merger through division: Provided, That a member of the organizing committee under Article 527 shall be the representative director.

(2) The provisions of Articles 374 (2), 439 (3), 522-3, 527-2, 527-3 and 527-5 shall apply mutatis mutandis to a merger through division.

Article 530-12 (Physical Division)

The provisions of this Section shall apply mutatis mutandis where a company to be divided acquires the total number of stocks of a company to be incorporated through a division or a merger through division.

m. Collective agreement

Article 12 (Obligation of Agreement) Company shall make an agreement in advance with the Cooperative on the following matters:

1. Merger, reorganization, dissolution, and transfer of a company;

2. Transfer of business units and units of motor vehicles;

Provided, That even if the contents of the project other than paragraphs 1 and 2 above are modified, an agreement shall be made with respect to the status of a member.

Article 16 (Activities of Associations during Working Hours)

1. In principle, partnership activities shall be performed outside working hours, and where it is inevitable to do so, partnership activities shall consult with the company, and the company shall guarantee partnership activities during working hours;

2. The number of days or hours during which a company and a cooperative do not work for the following activities of the cooperative shall be regarded as working after consultation with the company:

m. Division plan

On October 1, 2006, the due date for division (the succession of employees and retirement allowances) of employees and their retirement allowances, who are employed in a business division that is to be newly established by a divided company as of October 1, 2006, shall be succeeded to the company newly established as of October 1, 2006 (the due date for division).

[The Act on the Succession, etc. of Labor Contracts (Law No. 103 of May 31, 200), which was amended later, there was no big change in the contents] following the division of company.

[Purpose]

Article 1 The purpose of this Act is to promote the protection of workers by providing for special cases, etc. of the Commercial Act (Act No. 48 of 1899) and the Limited Liability Company Act (Act No. 74 of 1938) with respect to the succession, etc. of labor contracts in cases of corporate division.

[Notice to Workers]

Article 2

(1) When a company (referring to a stock company and a limited liability company; hereinafter the same shall apply) is newly incorporated, divided, or divided (hereinafter referred to as "divided") in accordance with Part II, Chapter VI-3 of the Commercial Act, and Chapter VI of the Limited Liability Company Act, it shall notify in writing the following workers of whether a written plan for division under Article 374 (1) of the Commercial Act (including cases applied mutatis mutandis under Article 63-6 (1) of the Limited Liability Company Act) or a written contract for division under Article 374-17 (1) of the Commercial Act (including cases applied mutatis mutandis under Article 63-9 (1) of the Limited Liability Company Act) is approved (hereinafter referred to as "written plan for division, etc.") at least two weeks prior to the day set for the general meeting of stockholders or general meeting of members (hereinafter referred to as "general meeting of stockholders, etc.") which approves the division, etc. (hereinafter referred to as "general meeting of stockholders"), that the company establishes the labor contract between the relevant employee and succeeds to the business (hereinafter referred to as "company, etc."):

1. Workers employed by the relevant company who are mainly engaged in the business succeeded to the establishment company, etc. and who are determined by the Ordinance of the Ministry of Labor;

2. A person who is employed by the company (excluding the workers employed in the preceding subparagraph) and includes a statement in the plan for division, etc. that the company should succeed to the employment contract that the company has entered into with the company concerned as the founder, etc.

(2) If a collective agreement is concluded with a trade union under Article 2 of the Trade Union Act (Act No. 174 of 1949) (hereinafter referred to as the “trade union”), the company that conducts the division under the preceding paragraph (hereinafter referred to as the “division”) shall notify, in writing, the company that establishes the relevant collective agreement succeeds to the relevant division by not later than two weeks prior to the date set for the general meeting of stockholders approving the plan for division, etc., whether or not there exists any description of the contract for division, etc., and other matters

(3) In the case of Articles 374-6 (1) and 374-22 (1) of the Commercial Act, the application of the preceding provisions of paragraph (2) shall be limited to "not later than two weeks prior to the date set for the general meeting of shareholders or the general meeting of shareholders (hereinafter referred to as "general meeting of shareholders, etc.") which approves" in paragraph (1) and "not later than two weeks prior to the date set for the general meeting of shareholders approved" in the preceding paragraph shall be deemed "within two weeks from the date set

【Succession of Employment Contracts Related to Workers who are mainly engaged in the Business】

An employment contract under which an employee under Article 3 (1) 1 of the preceding Article enters into with a divided company that the incorporated company, etc. succeeds to the division plan, etc. shall be deemed to be succeeded to the relevant incorporated company, etc. when the division becomes effective in connection with the relevant division plan, etc.

Article 4

(1) Workers provided for in Article 2 (1) 1, who do not indicate that the company that has established the division plan, etc., under which they have entered into a labor contract with the company that has established the division shall succeed, etc., may file an objection in writing with regard to the relevant divided company during the period from the date of notification under the same paragraph until the date determined by the division company [limited to the date from two weeks before the date of the general meeting of shareholders approved the division plan, etc., prepared by the relevant divided company to the day before the date of the relevant meeting; hereinafter referred to as the "period" in the following paragraphs and paragraph (1) of the following provisions:

(2) The company in division shall set a time limit at least 13 days between the date of notification referred to in the preceding paragraph and the time limit.

(3) In cases falling under Articles 374-6 (1) and 374-22 (1) of the Commercial Act, with respect to the application of the provisions of paragraph (1), "the day from two weeks before the date the general meeting of shareholders approved the plan, etc. prepared by the relevant company of division" in the same paragraph shall read "the day from the date before the date falling under Article 374 (2) 8 of the Commercial Act is newly established or divided, and the day from the date before the date falling under Article 374-17 (2) 9 of the same Act is applicable for absorption or

(4) Where the workers under paragraph (1) file an objection under the same paragraph, regardless of the provisions of Article 374-10 (1) of the Commercial Act (including cases applied mutatis mutandis in Article 63-6 (1) of the Limited Liability Company Act) or Article 374-26 (1) of the Commercial Act (including cases applied mutatis mutandis in Article 63-9 (1) of the Limited Liability Company Act), the labor contract which the relevant workers are concluded with the divided company shall be succeeded to the incorporated company, etc. at the time the

【Succession of Employment Contract Related to Workers】

Article 5

(1) Any worker referred to in Article 2 (1) 2 may raise an objection, in writing, to the effect that a labor contract between the relevant worker and the company that is to be divided is succeeded to by the company that is to be incorporated, etc. between the day on which the notice under the same paragraph is given and the day on

(2) The provisions of paragraphs (2) and (3) of the preceding Article shall apply mutatis mutandis to cases under the preceding paragraph.

(3) Where the workers under paragraph (1) file an objection under the same paragraph, regardless of the provisions of Article 374-10 (1) of the Commercial Act (including cases applied mutatis mutandis in Article 63-6 (1) of the Limited Liability Company Act) or Article 374-26 (1) of the Commercial Act (including cases applied mutatis mutandis in Article 63-9 (1) of the Limited Liability Company Act), a labor contract which is concluded with a divided company shall not be succeeded to

C. Facts of recognition

(1) As GENERAL MTRS Co., Ltd. (hereinafter “GM”) launched after the acquisition (hereinafter “Treatment Vehicle”) took an export structure of 86% of the output of the GEEM in a foreign country, unlike the existing time of the GEM vehicle, the domestic market share of the GEM vehicle was significantly reduced. While GM continuously expected to promote the domestic sales of the Plaintiff company, while four years have elapsed since the commencement of GM treatment, GM treatment was 10% of the domestic market share of GEM vehicle, and GM treatment was considerably reduced by the Plaintiff’s payment rate and settlement payment period as indicated below. In addition, the Plaintiff faces serious difficulties in supplying the Plaintiff’s vehicle from 2005 to 2006, both of the Plaintiff’s sales ratio were 20% of the Plaintiff’s vehicle.

[Attachment 1] Changes in the Terms and Conditions of Trade by Manufacturing

본문내 포함된 표 구분 1999년 2005년 2006년 판매마진 지급기일 판매마진 지급기일 판매마진 지급기일 GM대우 21% 180일 14~16% 35일 13~14% 30일 BUS 21% 180일 14% 80일 13% 80일 TRUCK 21% 180일 14% 80일 14.5%~13% 80일 쌍용자동차 21% ？ 판매중단

(2) Before the instant corporate division, the Plaintiff was comprised of the automobile sales sector, the construction sector, and the head office management sector. The automobile sales sector was composed of the direct passenger sales sector (600 members of the instant union; 212 members of the instant union), the agency sales sector (200 members of the instant union), the truck sales sector (170 members), the bus sales sector (30 members), and the import tea sales sector (50 members), etc. However, there was little personnel movement among each business sector. In particular, there was no personnel movement from the direct passenger sales sector to another sales sector. Since the end of 2005, there was no personnel movement from the direct passenger sales sector to the other sales sector. The Plaintiff conducted a desired retirement from 283 employees, and made efforts to improve the financial structure of the entire car sales sector (15% reduction of wages, and 3 years maintenance). However, it was impossible for the Plaintiff to improve the financial structure of the entire car sales sector to improve its management structure.

[Attachment 2] The status of changes in personnel in the management position

The number of persons (units: names) 1,650 on October 2007, 2005, 2002 included in the main sentence of the Table year 1,650 76750 on 2005

[Attachment 3] The current status of profit and loss in the automobile business sector between 2003 and 2006 (unit: KRW 00 billion)

Table classification contained in the main sentence in the year 2003 27,746 22,918 19,332 9,781 operating income in the year 2006 -242 -73 -752 -108

The Plaintiff’s automobile business sector is divided into direct sales, agency sales, commercial, import tea sales, truck sales, and bus sales, and the employees of the direct sales sector are largely divided into CM (high-class business, non-performance, which receive KRW 2.5 million or KRW 2.8 million or KRW 2.8 million or KRW 100,000 or KRW 100,000 or KRW 100 of the CM business is a member of the Korean Metal Trade Union in terms of personnel expenses) and STR (the worker converted from the change-oriented business due to actual results, and the change of the Plaintiff’s wage system in 202). Unlike STR business that sells three average monthly, the main cause of the enemy is that the CM business sector and part of STR business are less than one of the monthly sales results.

[Attachment 4] A business-based wage system

Between 3-3.5 vehicles selling approximately 70% of the fixed amount of non-fixed wage in CM business SR business position in the main sentence and approximately 30% of the monthly wage in 40%, which are included in the table in the main sentence, the same level of wage shall be maintained, and 3.5% of the wage-based rate of 30% in order to improve the wage level of SR business position by a large width after 3.5.

(3) In order to resolve the deficit in 2005, the Plaintiff agreed on wages with two times more or more higher wage increase than STR business employees in order to promote the improvement of productivity through granting sales motivations to CMF business employees. However, the sales failure of CMF business employees was not improved, and rather led to the failure of the entire business.

[Attachment 5] Contents of Business-Related Wages Wage Board in 2005

The details of the increase in CM business position SR business position in the main sentence - Basic pay: 20,000 won - 90,000 won for position allowance - 80,000 won per unit of salary per 10,000 won per unit of month: approximately 140,000 won increase per unit of salary.

[Attachment 6] From 2001 to 2006, the trend of changes in the CM business efficiency (productiveity)

The gap between 0.9 SDR 12.72.73.1 of 2.43 - 0.9 -2.9 -2.9 -2.42.42.02.02.9 -2.01.9 -2.02.02.9 -2.9 -2.42.02.02.9 -2.2.02.9 in 2004, 2005

[Attachment 7] The number of persons who have been unemployed in the CM business in 2006 (excluding full-time workers and those who have been temporarily dismissed)

본문내 포함된 표 구분 1월 2월 3월 4월 5월 6월 7월 8월 누계 CM 인원 51명 45명 37명 62명 37명 54명 41명 48명 375명 비율 48.1% 42.5% 35.2% 59.1% 35.2% 50.0% 38.3% 44,9% 43,4% SR 인원 37명 0명 12명 22명 30명 29명 10명 39명 179명 비율 7.9% ？ 2.6% 4.8% 6.6% 6.5% 2.3% 8.9% 4.9%

[Attachment 8] Comparison of average sales efficiency in the business year 2006

본문내 포함된 표 구분 인원수 1.0대 미만 1.0대~1.5대미만 1.5대~2.0대미만 2.0대~2.5대미만 2.5대~3.0대미만 3.0대~3.5대미만 3.5대 이상 평균효율 월 평균 무실적자수 조합원 CM 106 62 26 10 5 - 2 1 0.96 47 비율 58.5% 24.5% 9.4% 4.7% ？ 1.9% 0.9% 44.1% SR 101 9 18 18 26 12 8 10 2.09 9 비율 8.9% 17.8% 17.8% 25.7% 11.9% 7.9% 9.9% 8.9% 영업관리 3 2 - - 1 - - - 1.11 1 비율 66.7% ？ ？ 33.3% ？ ？ ？ 37.0% 비조합원 SR 171 7 3 7 20 23 25 86 4.16 7 비율 4.1% 1.8% 4.1% 11.7% 13.5% 14.6% 50.3% 4.1%

(4) In addition, in the case of a pure labor cost per head of CM business, 1,782,00 won per month and 112 employees per head of CM business, it was analyzed that KRW 200,000 per month were generated by an enemy. In the event that the Plaintiff’s profit and loss calculation result includes sales management expenses, the sales efficiency per head of CM business could escape from an enemy at levels of 4.0 to 4.5 per month. However, CM business was not 50% of his/her labor cost.

(5) On July 2006, the day before the instant corporate division, the Plaintiff requested A. T., an external consulting agency, to analyze the GM-DAT BU and take countermeasures in the future. At that time, the Plaintiff presented his opinion that the abolition of GM-DBU is the most significant measure to improve the management structure. Accordingly, even in a case where there is no record of the SR business with poor performance in fixed wage-centered CM and part, the Plaintiff was promoted a desired retirement and corporate division for workers in the direct sales sector as part of a voluntary structural reform in order to prevent free transfer of wages of an average of KRW 2.5 million per month from the profits of the other business sector, such as receiving wages of KRW 2.8 million per month from the average profits of the other business sector.

(6) As above, as the Plaintiff accumulated the accumulated number of persons in the direct sales sector among the automobile sales sector, the Plaintiff formulated a corporate division plan that establishes a newly incorporated company (DW&P) by dividing the unique sales sector among the direct sales sector with the lowest revenue and the agency sales sector with the highest revenue capacity. On August 18, 2006, the Plaintiff completed the corporate division procedure by completing the division plan approval of the general meeting of shareholders on September 29 of the same year and the division registration on October 11 of the same year.

(7) On September 28, 2006, the Plaintiff and the representative director of the newly incorporated company issued the following certificates to the Trade Union of this case.

- As a result of the corporate division of this case, the employees employed in the business division subject to division as of the date of division shall be succeeded to the newly established company.

- The new company shall succeed to all employment relationships and working conditions of the workers leaving their jobs from the plaintiff as at present.

- The plaintiff and new company shall also confirm that the collective agreement and the agreement pursuant to collective bargaining concluded by the intervenor are also effective for the newly incorporated company.

(8) On September 29, 2006, the Plaintiff publicly announced “The fact that the resolution of division was passed at the general meeting of shareholders on the same day, and the employee who intends to refuse to belong to the newly incorporated company and remain in the Plaintiff company shall file an objection from October 2 to 10 of the same year” (On the other hand, the Plaintiff asserted that all relevant workers were informed of the fact that he/she filed an objection by means of a mobile phone text message on September 30, 2006, but only part of the workers were given a mobile phone text message on October 10, 2006, and the rest workers did not receive the text message.” The above public notice and public notice contain that “It is not meaningful to agree, and it is necessary to conduct a standby and a layoff after submitting a written objection.”

In addition, on October 9, 2006 and October 10, 2006, the plaintiff announced only the business positions included in the business sector subject to the division of the company of this case as the day off, and the employees of the management department, such as the personnel department, etc. have taken measures to receive the written objection submitted on the Internet or directly. The contents of the day off and off from September 29, 2006 to October 10, 2006 concerning the day off and off from September 29, 2006 as indicated below.

본문내 포함된 표 월 화 수 목 금 토(휴일) 일(휴일) ？ ？ ？ ？ 9/29 사내전산망 공지 9/30 휴일 10/1 휴일 10/2 (이의신청서 접수시작) 10/3 개천절휴무 10/4 연중휴가 대체휴무 10/5 추석연휴 10/6 추석연휴 10/7 추석연휴 10/8 휴무 10/9 원고가 임시로 휴무지정 10/10(이의신청서 접수 만료일) 원고가 임시로 휴무지정 ？ ？ ？ ？ ？

(9) Since the labor union's period was too imminent for the trade union to submit written consent on the legality of a transfer with delegation of power from all union members, the union members notified the Plaintiff of the position that the union members refuse to transfer their names on October 10, 2006 and October 11, 2006. Accordingly, on October 11, 2006, the Plaintiff notified the Plaintiff of the position that the union members would refuse to transfer their names. Accordingly, on the ground that the union members did not submit written objection, the Plaintiff did not consent to the transfer of the union, the Plaintiff issued the instant order on October 11, 2006 regarding the total number of 525 workers including those who worked in the direct sales sector including the instant workers, and the newly established company issued a recruitment order for employment of the said workers on October 11, 206 following the date. As such, the company division was conducted on October 2, 2006.

(10) Meanwhile, members, including the intervenors, sent to the Plaintiff a written consent on the original register individually on October 12, 2009, in addition to the official written consent of October 10 and October 11 through a trade union. However, on October 17, 2006, the Plaintiff notified the instant workers of the purport that “the written consent of the former register was returned to the Plaintiff on October 11, 2006, on the ground that “the written consent was not submitted within the objection period, and the transfer to the newly incorporated company was completed on October 11, 2006.” Meanwhile, the instant union notified the instant union that “all the written consent received from the previous trade union is returned.”

(11) On December 1, 2006, 219, including the instant workers, filed an application with the Incheon District Court for a provisional measure to verify the status of the Plaintiff (2006Kahap2621), and the Incheon District Court accepted the said application on January 18, 2007 and decided that “the said 219 persons shall be temporarily determined as an employee by the said 219 persons against the Plaintiff.” On January 31, 2007, the Plaintiff issued a standby order as of 214 persons, including the instant workers, as of January 31, 207.

[Grounds for Recognition] Gap 1-14, Eul 1-17, and the purport of the whole pleadings

(d) Markets:

(1) Since the rapid change in the corporate environment in 1997, the importance of corporate restructuring is emphasized to cope with this change in the corporate organization. Among them, the amendment of the Commercial Act, which was introduced on December 28, 1998, requires ① the division of a company into which multiple business operations are carried out or the function of the company at each stage is complicatedly connected, thereby regulating the scale of appropriate business and regulating the management in a specialized and efficient manner, ② the division of a company into a mother company to limit the scope of risk burden by separating the business sector with high risk (or the business sector with low risk) from the mother company and to operate it as a separate independent company, ③ the division of a company to promote efficiency in its management by voluntarily operating it as a separate independent company. ④ The division of a company takes place when economic utility, such as the dissolution of profits and inheritance of a company.

(2) In order to resolve the instability in the employment succession due to corporate division, Japan enacted the Act on the Succession, etc. of Labor Contracts by corporate division and resolved legislative issues regarding the succession, etc. of labor relations at the time of corporate division. However, since Korea did not have any provision on the succession of labor relations in the process of adopting the corporate division system by amending the Commercial Act, the issue of succession of labor relations at the time of corporate division shall be resolved by analogy of the relevant provisions of the Civil Act, the Commercial Act, the Commercial Act, and the Labor Standards Act.

(3) The precedents take the position that, in principle, labor relations shall be succeeded to the assignee unless there is a special agreement between the transferor and the transferee at the time of transfer of business, and may be excluded from the succession in cases where the transferor and the transferee refuse the succession (see, e.g., Supreme Court Decisions 96Nu19314, Apr. 25, 1997; 2000Du8455, Mar. 29, 2002). However, in light of the following: (a) transfer of business constitutes a specific succession; (b) still exists after the transferor’s corporate transfer of business; and (c) Article 657(1) of the Civil Act provides for the exclusive nature of labor contracts and the consent of the employer at the time of the transfer of business, the comprehensive succession of labor relations of workers closely combined with the transferred business shall be deemed to have consented to the succession of labor relations in principle unless there is an explicit intention of workers to refuse the succession (see, e.g., Supreme Court Decision 2000Du84550, Mar., 2).

(4) However, since corporate division constitutes a comprehensive succession, it cannot be inferredly applied to the legal principle of succession of a labor relationship due to a business transfer falling under a specific succession. In a case where the status of another party of a labor relationship is changed due to corporate division, an employee’s comprehensive succession of a newly established company to protect the existence of a labor relationship refers to the formation of a labor relationship with an employer that cannot be deemed completely identical with the other party of an existing labor contract. This can be faithful to the protection of the existence of a labor relationship. However, from the perspective of the freedom of contract that forms a legal relationship with a party’s free decision-making, in substance, it may be contrary to the principle of self-determination by causing the same result that an employee is forced to freely choose with the employer who did not freely choose (the exclusive nature of a labor relationship is related to the provision of labor force for workers who cannot be separated from the employee, and thus, it is distinguishable from other legal relations). Therefore, the issue of succession of a labor relationship at the time of corporate division should be resolved in harmony between the

(5) We examine the following. ① In the case where the Plaintiff operating multiple businesses like this case divides a specific business part as part of restructuring in order to overcome the managerial crisis, the Plaintiff can eventually have the effect of discontinuing a specific business part without undergoing the procedure of dismissal under the Labor Standards Act. ③ In the case where the instant workers are changed to a newly incorporated company at the time of the conclusion of the labor contract with the Plaintiff, it is consistent with the exclusive nature of labor relations. ④ Since labor relations are comprehensively transferred due to corporate division, unlike the transfer of business, it is consistent with the exclusive nature of labor relations. ② In the case where the Plaintiff operating multiple businesses divides a specific business part as part of restructuring in order to overcome the managerial crisis, the Plaintiff is unable to overcome the managerial crisis and becomes insolvent, and the Plaintiff can have the effect of discontinuing a specific business part without undergoing the procedure of dismissal under the Labor Standards Act. ③ In the case where the instant workers are changed to a newly incorporated company at the time of the conclusion of the labor contract with the Plaintiff, it is reasonable to view that the employee’s intent is excluded from the right of refusal of comprehensive succession of labor relations with the company.

(6) In order to guarantee the above employee’s right to refuse, as a matter of principle, a reasonable period should be given to an employee who is subject to comprehensive succession at the time of corporate division. If an employer does not grant an employee a reasonable period required for exercising the right to refuse, this is null and void as it infringes on the employee’s right to own decision, and the period shall be extended by a reasonable period required for exercising the right to refuse.

(7) In this case, on September 29, 2006, the Plaintiff publicly announced on October 10, 2006 the time limit for exercising the right to refuse to exercise to the employees of this case through the intra-company computer network, but there is no proof that the above notice reached the employees of this case. ② The majority of the above time period for exercising the right to refuse to exercise is a legal holiday or temporary holiday, which makes it difficult for workers to have access to the above notice. ③ The above time period is recognized as considerably short of social norms in determining whether the workers of this case exercise the right to refuse to exercise the right to refuse to exercise in consideration of the capital, management planning, possibility of development, etc. of the newly established company and whether it is more favorable for them to decide whether to exercise the right to refuse to exercise the right to refuse to exercise the right to refuse. In light of the above, the part which the Plaintiff set on October 10, 2006 as the time limit for exercising the right to refuse to exercise is null and void.

(8) Therefore, it is legitimate to exercise the right to refuse the instant case, which the instant worker had exceeded the time limit for exercising the right to refuse as determined by the Plaintiff, but appears within the considerable period required for the exercise of the right to refuse by social norms, and submitted to the Plaintiff a written consent of the previous register by October 12, 2006. Thus, notwithstanding the instant workers’ right to refuse, the personnel order, which the instant worker retired from the Plaintiff Company and hired the newly incorporated company, shall be deemed null and void as there is no justifiable reason. Accordingly, the decision of retrial based on this conclusion

3. Conclusion

Therefore, the plaintiff's claim of this case is dismissed as it is without merit. It is so decided as per Disposition.

[Attachment 1] List of Intervenor joining the Defendant: (Omission)

[Attachment 2] List of Workers other than the Defendant joining the Defendant: (Omission)

Judges Jeong Jong-young (Presiding Judge)