[1] Purport of the system for exemption from working hours / Whether the act of paying wages to a designated employee subject to exemption from working hours constitutes unfair labor practices (negative in principle) / Whether it may constitute unfair labor practices in cases of paying excessive wages to the above employee without reasonable grounds (affirmative), and whether the same applies to cases where a labor-management agreement, such as a collective agreement, is reached (affirmative)

[2] Whether wages for workers designated as workers exempted from working hours constitute wages (affirmative in principle), and the method of calculating average wages to calculate retirement allowances for the above workers (affirmative in principle)

[1] According to Article 24(2) and (4) of the Trade Union and Labor Relations Adjustment Act (hereinafter “Trade Union Act”), an employee who exclusively works for a trade union (hereinafter “labor union full-time employee”) shall not receive any benefits from the employer during his/her full-time period, but an employee designated as eligible for the exemption from working hours (hereinafter “working hours exempted”) may, to the extent that does not exceed the notified limit of the exemption from working hours, maintain and manage the trade union’s activities such as consultation, negotiation, grievance settlement, and industrial safety with the employer without any loss of wages and for the development of sound labor-management relations. The above provision aims to ensure that the trade union’s activities continue to be performed within a certain scope of working hours in consideration of the net function of the labor union full-time employee system acting for labor management affairs, instead of prohibiting the trade union from financially dependent on the employer and securing the independence of the trade union.

In addition, Article 81 of the Trade Union Act regulating the employer’s unfair labor practices prohibits “an act of providing wages to pre-employed workers or assisting the operation expenses of a trade union” in the main sentence of subparagraph 4 by reflecting such contents, and the proviso provides that “an act of allowing a person exempt from working hours to engage in such activities as above during working hours” does not constitute unfair labor practices.

Therefore, barring special circumstances, the act of paying wages to a time-off worker does not constitute unfair labor practice. However, an employer’s act of paying excessive wages to a time-off worker without justifiable grounds exceeds the scope permitted under the proviso of Article 81 subparag. 4 of the Trade Union Act, and thus, constitutes unfair labor practice falling under the act of providing wages to a time-off worker or assistance in operating expenses of a trade union. It does not change even in cases where a labor-management agreement is reached

[2] Considering the contents, purport, and relevant provisions of the working hours exemption system, a wage for an employee designated as a target of working hours exemption (hereinafter “working hours exemption officer”) shall be deemed as having provided labor in relation to an employer according to the payment of working hours, unless it exceeds the reasonable scope acceptable in light of social norms compared with the ordinary working hours and payment standards of the same or similar class and salary grade of ordinary workers engaged in the same or similar kind of work at the relevant place of business, or those of the ordinary working hours in the same or similar class and salary grade, or those of the ordinary working hours, working conditions, etc., in the relevant place of business, unless there are special circumstances. Therefore, when calculating the average wage for a retirement allowance of a working hours exemption officer, it shall be based on the wage that the working hours exemption officer receives in accordance with a collective agreement, etc., unless there

[1] Articles 24(2) and (4), and 81 subparag. 4 of the Trade Union and Labor Relations Adjustment Act / [2] Articles 24(2) and (4), and 81 subparag. 4 of the Trade Union and Labor Relations Adjustment Act; Articles 2(1)5, 6, and 34 of the Labor Standards Act; Articles 2 subparag. 4 and 8(1) of the Guarantee of Workers’ Retirement Benefits Act

[1] Supreme Court en banc Decision 2014Du11137 Decided April 2, 2016 (Gong2016Sang, 707) en banc Decision 2010Hun-Ma606 Decided May 29, 2014 (Hun-Gong212, 976)

[Judgment of the court below]

Japanese Passenger Transport Service Corporation

Jeonju District Court Decision 201Na3322 decided December 16, 2011

Of the part of the judgment below against the plaintiff, the part concerning the claim for retirement allowance is reversed, and that part of the case is remanded to the Jeonju District Court Panel Division. The defendant's supplementary appeal is dismissed.

The grounds of appeal are examined.

1. Plaintiff’s ground of appeal

A. According to Article 24(2) and (4) of the Trade Union and Labor Relations Adjustment Act (hereinafter “Trade Union Act”), an employee who is engaged exclusively in the affairs of a trade union (hereinafter “labor union operator”) shall not receive any benefits from the employer during the previous period, but an employee designated as eligible for the exemption of working hours (hereinafter “person entitled to exemption from working hours”) may, without loss of wages, maintain and manage a trade union’s maintenance and management for the development of sound labor-management relations with the employer, such as consultation, negotiation, grievance settlement, and industrial safety activities with the employer without any loss of wages, to the extent that does not exceed the limit of the exemption from working hours publicly notified. The foregoing provision aims to ensure the continuation of the trade union’s activities within a certain scope, instead of prohibiting a trade union from financially dependent on the employer and securing the independence of the trade union (see, e.g., Constitutional Court en banc Decision 2010Hun-Ma606, May 29, 2014).

In addition, Article 81 of the Trade Union Act regulating the employer’s unfair labor practices prohibits “an act of providing wages to pre-employed workers or assisting the operation of a trade union” in the main sentence of subparagraph 4 by reflecting such contents, and the proviso provides that “an act of allowing a person exempted from working hours to engage in such activities as above during working hours” does not constitute unfair labor practices.

Therefore, barring special circumstances, the act of paying wages to a time-off worker is not an unfair labor practice. However, an employer’s act of paying excessive wages to a time-off worker without justifiable grounds to a time-off worker is beyond the scope permitted under the proviso to Article 81 subparag. 4 of the Trade Union Act, and thus, constitutes an unfair labor practice falling under the act of providing wages to a time-off worker or assisting operating expenses of a trade union. It does not change even in cases where a labor-management agreement, such as a collective agreement, is concluded (see Supreme Court Decision 2014Du1137, Apr. 2, 201

Considering the contents, purport, and relevant provisions of the working hours exemption system, it is reasonable to view that wages of those who have been exempted from working hours are paid in relation to employers according to the payment of working hours, unless it is so excessive that it would exceed the reasonable scope acceptable in light of social norms compared with the standard of ordinary working hours, working conditions, etc. of the same or similar class and salary grade of ordinary workers engaged in the same or similar kind of work at the relevant workplace if they were employed as general workers without being designated as those exempted from working hours. Therefore, in calculating the average wage related to retirement allowances of those who have been exempted from working hours, barring any special circumstance, it shall be based on the wages that are paid by those who have been exempted from working hours pursuant to a collective agreement, etc., but the excessive amount of wages

B. Review of the reasoning of the lower judgment and the record reveals the following circumstances.

1) The instant collective agreement and the wage agreement of this case concluded in 2010 between the Korea Automobile Trade Union, the Korea Automobile Trade Union, to which the Defendant Company’s trade union belongs, and the Jeollabuk-do Bus Transport Business Association, to which the Defendant Company belongs, concluded in 2010 (hereinafter collectively referred to as the “instant collective agreement, etc.”), and the Defendant Company’s company, pursuant to Article 24(4) of the Trade Union Act, with respect to the head of the Defendant Company’s branch office, the Defendant Company’s trade union shall be exempted from working hours on the basis of Article 24(4) of the Trade Union Act, and the amount of wages of those who are exempted from working hours shall be determined as KRW 3,20,00 per month, and the amount of wages of KRW 9,00 per month

2) The Plaintiff, the president of the Defendant Company’s chapter, was exempted from paid working hours under the instant collective agreement, and performed the maintenance and management of the labor union for the development of labor-management relations, such as consultation, negotiation, and grievance settlement with the Defendant Company from July 2010 to retirement.

C. Examining such facts in light of the legal principles as seen earlier, even if there are parts of excess benefits determined to be paid by the Plaintiff pursuant to the instant collective agreement, the remaining benefits excluding such excess amount are still included in the calculation of average wages. As such, the lower court should have calculated the average wage for the calculation of retirement allowances based on the foregoing.

Nevertheless, the lower court determined otherwise by concluding that the Defendant’s payment of wages to the Plaintiff as a time-off worker pursuant to the instant collective agreement, etc. cannot be deemed as remuneration for labor, and calculated retirement allowances based on the average wage of the same class and salary class workers. Therefore, the lower court erred by misapprehending the legal doctrine on the nature of the benefits received by the time-off worker as prescribed in Article 24(4) of the Trade Union Act and the method of calculating the average wage, thereby failing to exhaust all necessary deliberations. The allegation contained in the grounds of appeal on

2. As to the Defendant’s grounds of incidental appeal

According to the reasoning of the judgment below, the court below rejected the aforementioned defense on the ground that the plaintiff, who is the full-time employee of the defendant, was not paid any benefits from the defendant who is the employer during the full-time period pursuant to Article 24(2) of the Trade Union Act. As such, the payment of benefits already received from the defendant constitutes unjust enrichment, and the defendant, based on the circumstance as stated in its reasoning, is in the position of the plaintiff to be exempted from working hours of the defendant company under Article 24(4) of the Trade Union Act, even though he was a full-time employee, based on the circumstance as stated in its reasoning, etc., he was in the position of the plaintiff to be exempted from working hours of the defendant company under Article 24(4

Examining the above legal principles and records, the lower court did not err by misapprehending the legal doctrine on the interpretation of Article 24(2) and (4) of the Trade Union Act, contrary to what is alleged in the grounds of appeal.

3. Conclusion

Therefore, the part of the judgment below against the plaintiff is reversed, and that part of the case is remanded to the court below for further proceedings consistent with this Opinion. The defendant's incidental appeal is dismissed. It is so decided as per Disposition by the assent of all participating Justices on the bench.

Justices Kim Shin (Presiding Justice)