[1] The meaning of "wages for the final three months" under Article 37 (2) 1 of the Labor Standards Act, which recognize preferential payment right

[2] The case holding that, in case where bonuses are paid at a certain ratio of each basic salary at the end of three times per year, and such bonuses have the nature of wages paid as remuneration for work, bonuses for which the right to preferential payment is recognized under the Labor Standards Act are not the total amount of annual bonuses between the last three months before retirement and the total amount of annual bonuses of the Gu affairs, but the amount equivalent to the last three months before retirement

[1] Article 37(2) of the Labor Standards Act provides that wage claims of workers for the last three months, retirement allowance claims for the last three years, and accident compensation claims shall be paid in preference to claims secured by pledges or mortgages on the whole property of the employer, taxes, public charges, and other claims. The wage claims of the last three months under the above provision do not mean wage claims arising between the last three months and the last three months, but refer to wage claims of the part which served for the last three months.

[2] The case holding that, in case where bonuses are paid at a certain ratio of each basic salary at the end of three times per year, and such bonuses have the nature of wages paid as remuneration for work, bonuses for which the right to preferential payment is recognized under the Labor Standards Act are not the total amount of annual bonuses between the last three months before retirement and the total amount of annual bonuses of the Gu affairs, but the amount equivalent to the last three months before retirement.

[1] Article 37 (2) 1 of the Labor Standards Act / [2] Article 37 (2) 1 of the Labor Standards Act

Plaintiff (Appointed Party) (Attorney Kim Yong-jin, Counsel for the plaintiff-appellant)

New Bank Co., Ltd. (Law Firm Postal Savings Bank, Attorneys Doh-won et al., Counsel for defendant-appellant)

Seoul High Court Decision 99Na67040 delivered on November 9, 2001

The judgment below is reversed and the case is remanded to Seoul High Court.

1. Regarding ground of appeal No. 1

According to the evidence adopted by the court below, the plaintiff (appointed party; hereinafter referred to as "the plaintiff") and the designated parties are workers of the Ulim Engineering Co., Ltd. (hereinafter referred to as "non-party company"), Article 30 of the Rules of the non-party company stipulates the amount of bonus as 300% of the basic salary, and Article 31 provides that the bonus payment shall be due to the payment date of bonus, vacations, Gu affairs, and other matters, but in fact, the non-party company shall pay 30% of the basic salary per annum 10% of the annual salary, but the non-party company has a different service period of less than 3 months according to the period of service, 50% of the basic salary, and 100% of the basic salary, and the non-party company shall pay the plaintiff and the selected parties for the above 30% of the amount of bonus, 30% of the paid annual bonus and the amount of bonus shall not be paid for the above 190% of the total amount of bonus, 1985% of the status of bonus.

The ground of appeal on this point is without merit.

2. Regarding ground of appeal No. 2

The court below, based on the evidence of the judgment, found that the Appointor 2 was registered as a director in the corporate register of the non-party company, but it was only registered in the form for the purpose of meeting and maintaining the form of the corporation by the non-party, who is the representative director of the above company, and in fact, the above Appointor 2 did not have any evidence to deem that the above Appointor 2 exercised the right to conduct the business as a director of the above company. The court below determined that the above Appointor 2 was an employee of the above company, unless it is proved that the above Appointer 2 had exercised the right to conduct the business as a director of the above company. Upon comparing the evidence adopted by the court below with the records, the court below's findings and determination of facts are just and there is no error of law

The argument in the grounds of appeal on this point is not acceptable.

3. As to the third ground for appeal

A. On November 16, 1996, the court below established the right to collateral security against the defendant and the non-party 2 as to each of the above real estate as stated in the judgment below, and applied for an auction of real estate under the Suwon District Court around 98 and 34903 for the enforcement of the above right to collateral security; the plaintiff and the designated persons who are the workers of the non-party company made a demand to the defendant for dividends of KRW 205,343,920 for the wages (including bonuses) and retirement allowances for the last 3 months from 197 to February 1998; the court below determined that the above amount was 605,312,95 won to be distributed on the date of distribution of the above auction procedure; the above amount was 106,300 won to the plaintiff and the designated persons who are the wage creditors; the above amount was 149,09,960 won to be distributed to the defendant; the above amount was 105,970 won and 197 won to the above dividends amount of KRW 197.4.7

B. The Plaintiff and the designated parties have the nature of wage paid as remuneration for work as stated in paragraph (1) above. Article 37(2) of the Labor Standards Act provides that wage claims of workers for the last 3 months, retirement allowance claims for the last 3 years, accident compensation claims shall be paid in preference to claims secured by pledges or mortgages on the whole property of the employer, taxes, public charges, and other claims. The wage claims for the last 3 months under the above provision do not mean the wage claims for the last 3 months, but means the wage claims for the part in which they have worked for the last 3 months. Thus, the part for which the Plaintiff and the designated parties may claim preferential payment rights under the Labor Standards Act among bonuses that have not been paid by the non-party company is limited to the payment claims for the last 3 months prior to their retirement.

C. However, as seen earlier, the non-party company has paid bonuses to its employees at a fixed period of not less than a month at the rate of each basic salary at three times at the end of the Gu administration, year year, year, and year. As such, the Plaintiff and the designated parties have to receive annual bonuses at the end of 1997 and the total amount of the Gu affairs bonuses at the end of 1998 from December to February 2, 1998, which were the last three months before their retirement, shall not be the remuneration for their work. Thus, the court below should have deliberated and reviewed the part in which the Labor Standards Act recognizes the preferential payment right among the above bonuses, which is the part where the payment right under the Labor Standards Act is recognized, and should have been paid for the work for the last three months before their retirement, and should have cancelled the distribution of the amount corresponding to that part and distributed it to the Plaintiff and the designated parties, and should have changed the distribution schedule

Ultimately, the court below erred in the misapprehension of legal principles as to the scope of the scope of the right to preferential payment under the Labor Standards Act among the bonus in this case, which has the nature of wage, or in the incomplete hearing, and it is clear that such illegality has influenced the conclusion of

The ground of appeal pointing this out is with merit.

4. Therefore, the lower judgment is reversed, and the case is remanded to the lower court for further proceedings consistent with this Opinion. It is so decided as per Disposition by the assent of all participating Justices on the bench.

Justices Song Jin-hun (Presiding Justice)