In calculating the annual leave allowance not paid to an employee due to his/her unfair dismissal, whether the period during which the employee was unable to work due to his/her unfair dismissal should be included in both the number of contractual working days and the number of working days per year (affirmative), and whether the same applies to the case where the relevant dismissal period accounts for all the total number of working days per year (affirmative)

If an employer dismissed a worker, but the dismissal is null and void because there is no justifiable reason, all wages which would have been received if the worker had continued to work normally during the period of dismissal can be paid to all. Even if the dismissed worker did not work during the period of dismissal, so long as the dismissal is null and void, the labor relationship with the employer is still in existence, and if the worker did not work during the period of dismissal is due to the cause attributable to the employer who was unfairly dismissed.

Therefore, even in cases where wages paid to a worker due to an unfair dismissal are annual paid leave allowance, if the relevant worker satisfies the requirements of Article 60(1) of the Labor Standards Act by taking into account the annual fixed working days and the number of working days, the annual paid leave allowance shall be paid on the premise that the annual paid leave is granted, and in calculating the annual fixed working days and the number of working days, the period shall not be considered disadvantageous to the relevant worker when calculating the annual fixed working days and the number of working days, so it shall be reasonable to view that all the annual fixed working days and the number of working days are included in the calculation of the number of working days. Even if the period of unfair dismissal accounts for all the total working days, it shall not be viewed differently.

Article 538(1) of the Civil Act; Articles 23(1) and 60(1) of the Labor Standards Act

[Plaintiff-Appellant-Appellee] Plaintiff 1 and 1 other (Law Firm Gyeong, Attorneys Park Jong-soo et al., Counsel for plaintiff-appellant-appellant-appellee)

Plaintiff (Attorney Shin Young-hoon, Counsel for plaintiff-appellant)

Busan National Development Co., Ltd. (Law Firm Maumop, Attorneys Jjin-jin et al., Counsel for the plaintiff-appellant)

Jeju District Court Decision 201Na1392 decided October 5, 2011

The appeal is dismissed. The costs of appeal are assessed against the defendant.

The grounds of appeal are examined (to the extent of supplement in case of supplemental appellate briefs not timely filed).

1. As to whether annual leave allowances are paid

Article 60(1) of the Labor Standards Act provides that “an employer shall grant an annual paid leave of 15 days to an employee who has worked not less than 80 percent per year.” This purport is to exempt an employee from his/her duty of labor for a certain period to provide an opportunity for mental and physical recreation and to improve his/her cultural life (see, e.g., Supreme Court Decisions 95Nu6649, Jun. 11, 1996). Such annual paid leave is not naturally guaranteed, but can be granted only when an employee has worked not less than 80 percent per year, barring any special circumstances, since it can be deemed that the annual paid leave constitutes a remuneration for his/her work for one year, and therefore, the annual paid leave allowance for which an employer may claim as a result of the employee’s failure to use his/her annual paid leave constitutes wages (see, e.g., Supreme Court Decisions 91Da14826, Nov. 12, 191; 200Da869, Feb. 9, 20000).

In this context, whether workers have worked for at least 80 percent of a year shall be determined at the rate based on the number of days excluding the days determined by statutes, collective agreements, rules of employment, etc. from the total calendar days for one year, i.e., the number of days during which workers have an obligation to work in a year (hereinafter “annual fixed working days”). The annual fixed working days are based on the actual number of days during which workers have an obligation to work in a labor relationship between the original employer and the employee, i.e., the provision of labor to the employer, and on the condition that the continuous provision of labor is scheduled (see Supreme Court Decision 2011Da4629, Dec. 26, 2013).

Meanwhile, in a case where an employer dismissed a worker, but the dismissal becomes null and void due to the absence of any justifiable reason, all wages which would have been received if the worker continued to work normally during the period of dismissal may be paid to the worker. Even if the dismissed worker did not work during the period of dismissal, so long as the dismissal is null and void, the labor relationship with the employer is still in existence with the employer. This is because the failure of the worker to work during the period of dismissal constitutes a cause attributable to the employer who was unfairly dismissed (see Supreme Court Decision 81Da626, Dec. 22, 1981).

Therefore, even in cases where wages paid to a worker due to an unfair dismissal are annual paid leave allowance, if the relevant worker satisfies the requirements of Article 60(1) of the Labor Standards Act by taking into account the annual fixed working days and the number of working days, the annual paid leave allowance shall be paid on the premise that the annual paid leave is granted, and in calculating the annual fixed working days and the number of working days in order to calculate this, the employer’s unfair dismissal cannot be considered disadvantageously for the worker. Therefore, it is reasonable to view that the period is all included in the annual fixed working days and the number of working days. Even if the relevant dismissal period accounts for all the total number of working days, it cannot be viewed differently.

After compiling the adopted evidence, the court below acknowledged the facts as stated in its decision, and found that the plaintiffs (appointed parties) and the designated parties (hereinafter referred to as the "Plaintiffs") all were 80% or more of the working hours in 2008 and 2009 including the period of dismissal (the number of working days and the number of working days). Thus, the plaintiffs were deemed to have all the statutory working days in accordance with Article 60 of the Labor Standards Act and Article 25 of the collective agreement. On the premise of this, the court below held that the plaintiffs were liable to pay each annual paid leave allowance to the defendant corresponding thereto after calculating the number of days of each annual paid leave in 2008 and 209. On the premise of this, the court below rejected the defendant's assertion that the annual paid leave does not occur if the period of unfair dismissal corresponds to all the total number

Examining the reasoning of the lower judgment in light of the aforementioned legal principles and records, the lower court’s aforementioned determination is justifiable, and contrary to what is alleged in the grounds of appeal, the lower court did not err by misapprehending the legal doctrine on interpretation or application of Article 60

2. As to whether the case constitutes ordinary wages

Since ordinary wages are prescribed by the Labor Standards Act to establish the standards for working conditions, the meaning and scope of ordinary wages are not of the nature that an employer and an employee may agree separately by collective agreement, etc. Therefore, even if the employer and an employee agreed to exclude wages belonging to ordinary wages under the Labor Standards Act from ordinary wages, such agreement is not effective. In light of the nature of the Labor Standards Act, the provisions of the Labor Standards Act which provide that an employer shall pay overtime, night, or holiday labor by adding at least 50% of ordinary wages to the minimum standards for calculating wages for each relevant labor. Thus, in cases where the labor-management agreed to calculate additional wages for overtime, night, or holiday labor without excluding part of the ordinary wages, if the amount calculated according to the labor-management agreement falls short of the above standards prescribed under the Labor Standards Act, the labor-management agreement shall be null and void to the extent that it falls short thereof, and the invalidated portion shall comply with the standards prescribed under the Labor Standards Act (see, e.g., Supreme Court

After compiling the adopted evidence, the court below determined that the collective agreement of this case was null and void because it violated the Labor Standards Act, and recognized the amount of the annual leave allowance, etc. in accordance with the method of calculating the number of days of annual leave and ordinary wages as determined by the defendant.

Examining the reasoning of the lower judgment in light of the aforementioned legal principles and records, the lower court’s aforementioned determination is justifiable, and contrary to what is alleged in the grounds of appeal, there were no errors by misapprehending the legal doctrine on the calculation of ordinary wages

3. Conclusion

Therefore, the appeal is dismissed, and the costs of appeal are assessed against the losing party. It is so decided as per Disposition by the assent of all participating Justices.

[Attachment] List of Appointeds: Omitted

Justices Kim Shin (Presiding Justice)