[1] In a case where an employer and an employee paid a certain amount in advance along with a monthly or daily allowance paid by the employer and an employee, the validity of the aforementioned agreement on division of retirement allowances (=in principle invalid) and whether the amount under the name of retirement allowances already paid pursuant to an invalid agreement constitutes unjust enrichment (affirmative), and the standard for determining whether there exists an agreement on division of retirement allowances between the employer and the employee

[2] In a case where Gap et al. agreed to include the annual salary amount at the time of the preparation of the annual salary contract with Eul et al., and specified the monthly amount in the annual salary contract, the case holding that the court below erred by misapprehending legal principles in holding that Gap et al. was liable to return unjust enrichment money in the name of the retirement allowance received by Gap et al. to the company for unjust enrichment, even though there are many reasonable grounds to regard that the above agreement on the division of the retirement allowance was made in the form of an agreement on the division of the retirement allowance in order to avoid the payment of the retirement allowance, and only took the form of the agreement

[1] Article 2(1)5 of the Labor Standards Act; Article 8 of the Guarantee of Workers' Retirement Benefits Act; Article 741 of the Civil Act / [2] Article 2(1)5 of the Labor Standards Act; Article 8 of the Guarantee of Workers' Retirement Benefits Act; Article 741 of the Civil Act

[1] Supreme Court en banc Decision 2007Da90760 Decided May 20, 2010 (Gong2010Sang, 1132) Supreme Court Decision 2008Da9150 Decided May 27, 2010

Plaintiff 1 and one other (Law Firm Sungwon, Attorneys Hong-soo et al., Counsel for the plaintiff-appellant)

Long-term Family (Law Firm B&S, Attorneys White-soo et al., Counsel for defendant-appellant)

Incheon District Court Decision 2008Na14947 Decided October 26, 2010

The part of the judgment of the court below against the plaintiffs regarding the retirement allowance claim shall be reversed, and that part of the case shall be remanded to the Incheon District Court Panel Division.

The grounds of appeal are examined.

1. If the employer and the employee agreed to pay in advance a certain amount of money with the monthly pay or daily pay paid by the employee (hereinafter “retirement Allowance installment agreement”), such agreement is null and void because it is contrary to compulsory law because the employee waives his/her right to claim a retirement allowance at the time of the final retirement unless it is acknowledged as an interim payment of the retirement allowance, and as a result, the employer has no effect as a retirement allowance payment even if the employer paid the employee a certain amount of money in the name of the retirement allowance according to the agreement on the

Meanwhile, wages under the Labor Standards Act refer to all the amounts that an employer pays to an employee as remuneration for work, and that the employer bears the obligation to pay the amount in the name of a retirement allowance separately from the monthly salary or daily wage under a collective agreement, employment rules, salary regulations, labor contract, or labor practice. However, if a retirement allowance agreement is null and void for the aforementioned reason, and the agreement on the division of a retirement allowance is null and void, it cannot be deemed that the amount in the name of a retirement allowance already paid under the above agreement constitutes “wages paid for an employee.” Therefore, it is reasonable from the perspective of fairness to view that an employer should return the amount in the name of a retirement allowance to an employer as unjust enrichment, while an employee suffers losses in the amount equivalent to the same amount by paying the amount in the name of a retirement allowance to an employee without any legal cause (see Supreme Court en banc Decision 2007Da90760, May 20, 201).

However, considering the legislative purport of the retirement allowance system as a mandatory law, the above legal principle is applicable only on the premise that there exists an agreement on actual division of retirement allowances between an employer and an employee. Although the pertinent agreement entered into between an employer and an employee is merely the determination of wages, the above legal principle is not applicable in cases where the employer and an employee take the form of an agreement on division of retirement allowances in order to avoid the payment of retirement allowances. In other words, there is an agreement between an employer and an employee to the effect that an employer includes a retirement allowance in a monthly or daily pay and a separate retirement allowance at the time of retirement, and the nominal amount of the retirement allowance is specified, and the above legal principle is applicable only in cases where the content of the employment agreement, including the agreement on division of retirement allowances, should not be disadvantageous to an employee in light of the previous employment contract or the Labor Standards Act, considering the amount of wages, other than the above nominal amount of retirement allowances, etc. (see Supreme Court Decision 2008Da9150, May 27, 2010).

2. (1) The lower court determined that the Plaintiffs and the Defendant were not obligated to pay the amount of retirement benefits under the agreement to actually pay a certain amount under the pretext of additional retirement benefits, regardless of the fact that (2) each annual salary contract entered into with the Defendant on or after February 2004 only stated the purport that the amount of retirement benefits is included in the annual salary amount, and that the amount of retirement benefits separate from the wages was specified in the employment contract entered into before February 2004, and thus, it cannot be deemed that the Plaintiffs and the Defendant agreed to actually pay a certain amount under the pretext of additional retirement benefits before February 2004. However, the lower court determined that the Plaintiffs were not obligated to pay a retirement allowance under the pretext of the agreement to actually pay the amount of retirement benefits under the pretext of the above agreement to the Defendant for the purpose of including the annual salary amount at the time of the preparation of each annual salary contract after February 204 and that there was no specific amount under the pretext of the monthly retirement benefits after February 204.

3. However, the following circumstances acknowledged by the record, i.e., (1) determined the Plaintiffs’ annual salary and monthly salary without considering the Plaintiffs’ average wage when calculating the monthly amount of retirement allowances, and determined uniformly the amount in the form of retirement allowances (i.e., the Defendant’s arbitrary payment of an amount equivalent to 12/13 of the annual salary by classifying the amount as retirement allowances); (ii) the Defendant included the amount in the form of retirement allowances in determining the wages that are the basis of the calculation when paying annual monthly allowances to employees; (iii) it is difficult to readily conclude that the amount paid as retirement allowances at the places of the Plaintiffs who received monthly salary and the portion not so, was clearly distinguishable from the portion not so paid; (iv) it would be difficult to view that the Plaintiffs’ actual payment of the annual salary after 2003 reduced the annual salary and would be disadvantageous to the Plaintiffs’ actual payment of the retirement allowances after 204 annual salary after 200, including the amount of the annual salary after 2004.

Nevertheless, solely based on the circumstances indicated in its reasoning, the lower court determined that the Defendant was obligated to return to the Defendant money in the name of retirement allowances received by the Plaintiffs for unjust enrichment, deeming that the Defendant paid the money in addition to the amount in the name of retirement allowances, which is substantially distinguishable from the wages, pursuant to the retirement allowance installment agreement since February 2004. In so doing, the lower court erred by misapprehending the legal doctrine on the retirement allowance

4. Therefore, the part of the judgment below against the plaintiffs regarding the retirement allowance claim is reversed, and that part of the case is remanded to the court below for a new trial and determination. It is so decided as per Disposition by the assent of all participating Justices on the bench.

Justices Kim Shin (Presiding Justice)