Plaintiff 1 and 25 others (Law Firm Han, Attorney Gong Sung-soo, Counsel for the plaintiff-appellant)

Helty Co., Ltd. (Law Firm Choe et al., Counsel for the defendant-appellant)

June 5, 2015

Seoul Central District Court Decision 2013Gahap12940 Decided September 18, 2014

1. The part against the defendant in the judgment of the first instance is revoked, and the plaintiffs' claims corresponding to the revoked part are all dismissed.

2. The costs of the lawsuit are assessed against the Plaintiffs.

1. Purport of claim

The defendant shall pay to the plaintiffs 20% interest per annum from each of the amounts stated in the "total amount of claims" in the attached Table to each of them, and the amount calculated at the rate of 20% per annum from each of the corresponding dates to the day of full payment.

2. Purport of appeal

The same shall apply to the order.

1. Scope of the judgment of this court;

In the first instance court, the Plaintiffs sought retirement allowances and allowances for overtime, holiday, and annual leave work and compensation for delay against the Defendant. The first instance court’s judgment partially accepted retirement allowances and claims for retirement damages and compensation for delay, and dismissed the remainder of retirement allowances, extension, holiday, annual leave work allowances and claims for delay damages. Since only the Defendant appealed against this, the subject of the judgment of this court is limited to the part cited by the first instance court in the claims for retirement allowances and compensation for delay.

2. Basic facts

A. The Defendant Company, engaged in import, manufacture, and sales business, such as KONEX, scarf, and bags, concluded a special purchase transaction agreement with the Defendant Company to purchase on credit goods imported and manufactured by the Defendant Company, sell such goods in the department store operated by the Defendant Company, and pay the remaining amount after deducting the commission from the sales revenue, while entering into a contract with the Defendant Company to dispatch the manpower engaged in sales business within each department store.

B. The Plaintiffs prepared a “sales service agreement” with the Defendant company around the corresponding day specified in the attached Table “the date of commencement of business” and, from each of the above corresponding dates, performed their duties as a sales salesperson who sells goods imported or manufactured by the Defendant Company within each department store, and terminated the sales business on each of the corresponding days specified in the attached Table “the date of completion of business”.

[Ground of recognition] The fact that there is no dispute, Gap's No. 41, Eul's No. 5 (including branch numbers; hereinafter the same shall apply), and the purport of the whole pleadings

3. The parties' assertion

A. The plaintiffs' assertion

The Plaintiffs are workers who provided labor under the direction and supervision of the Defendant, and have not received each retirement allowance as stated in the “amount of claim for retirement allowance” in the attached Table, notwithstanding their retirement from the Defendant Company. Therefore, the Defendant is liable to pay the said retirement allowance and damages for delay thereof to

B. Defendant’s assertion

Since the Plaintiffs entered into a sales services contract with the Defendant, and received fees after providing services accordingly, they cannot be deemed as the employees of the Defendant Company.

4. Determination

A. Whether the plaintiffs constitute workers under the Labor Standards Act

1) Relevant legal principles

Whether a worker is a worker under the Labor Standards Act ought to be determined depending on whether the form of a contract is an employment contract or a contract for employment, and whether an employee has provided labor in a subordinate relationship with an employer for the purpose of wages at a business or workplace. Here, whether a dependent relationship exists should be determined by determining the content of work, and whether the employer has considerable command and supervision in the course of performing work, such as employment rules or personnel regulations, etc., whether the employer is designated working hours and working places, whether the employer is bound by the employer, whether the employer is capable of operating his/her business on his/her own account, such as possessing equipment, raw materials, working tools, etc., or having a third party employ on his/her own, and whether the risks such as the creation of profits and losses through the provision of labor, whether the nature of remuneration is the subject of the labor itself, whether the basic salary or fixed wage has been determined, whether the wage was withheld at source, and whether the employer has exclusive affiliation to the employer, and whether the social security system is recognized as an employee or not.

(ii) the facts of recognition

The following facts may be acknowledged in full view of the purport of the entire pleadings in the statements stated in Gap evidence 2 through 36, 39, 41 through 43, 45, 47, 48, Eul evidence 1 through 5, 8, 12 through 15, 17, 22, and 27:

A) The main contents of a special contract for purchase and purchase entered into between the Defendant and the department store operating company are as follows (the “A” refers to the department store operating company, and the “B” refers to the Defendant).

(4) In the event that the term “employee, etc.,” used in the provisions of the proviso to Article 2 of the Act and the Special Agreement on the Control of Workers, etc., to which the term “employee, etc.,” used in the provision of the Act and the provision of the Special Agreement on the Control of Employees, etc., have no capacity to take necessary measures for the prevention of sale”, the term “in the event that the employee, etc.,” used in the provision of the Act and the provision of the Special Agreement on the Control of Employees, etc., to which the “employee, etc.,” used in the provision of the Act and the provision of the Special Agreement on the Control of Employees, etc., have no capacity to take measures for the prevention of sale” shall be deemed to have been carried out by the employee, etc., such as the provision of the Act and the provision of the Special Agreement on the Control of Employees, etc., to which the “, etc.,” used in the provision of the Act and the provision of the Ordinance on the Control of Employees, etc., shall be deemed to have been carried out.

B) The Defendant initially employed the sales clerks as full-time employees belonging to the sales department. Around August 2005, the Defendant received written resignations from the sales department clerks in a lump sum, and paid retirement allowances at the end of 2005, and concluded sales services contracts with the above sales department clerks, and subsequently recruited the sales department clerks by concluding sales services contracts other than employment contracts.

C) The Defendant did not require the Plaintiffs and other salespersons to report on the current status of their attendance and retirement. Although some salespersons voluntarily submitted to the Defendant materials on the current status of their work performed at the store, they did not have been forced to prepare a list of the current status of their work. Although there was a lack of demand from November 2012 to March 2013 for computerized registration of the hours of their attendance from around March 2013, the above guidelines were temporarily suspended.

D) The sales clerks including the Plaintiffs were notified of the use of leave to the Defendant’s headquarters, but there was no restriction on the need to submit a leave period to obtain prior permission, unlike the Defendant’s regular employees.

E) The Defendant’s head office could grasp the inventory status of each store via the computer system in real time. The employees of the business division of the Defendant’s head office visited each store at approximately one week and confirmed the sales status, etc. However, the Defendant did not give specific instructions to the sales clerks including the Plaintiffs regarding the method of performing sales affairs, and did not provide separate education regarding the implementation of business affairs, except twice a year.

F) Under a sales service contract, the Defendant provided that the monthly fee calculated by multiplying the monthly sales by a certain fee rate shall be paid to the salespersons, including the Plaintiffs, from the date of the first sales service contract to September 2008. The Defendant paid the fee calculated according to the sales amount by setting the upper limit and lower limit line, and paid an amount equivalent to the lower limit line in cases where the fees calculated by multiplying the sales amount by the upper limit and the lower limit line are less than the lower limit line, and an amount corresponding to the upper limit line in cases where the fees exceed the upper limit line. The Defendant paid a certain monthly amount of fee from September 2008 to the end of 2011, regardless of the change in the sales amount, however, the method of re-payment of the fee calculated according to the sales amount after September 2012.

G) The Defendant shared the costs of the Plaintiff’s sales store’s facilities, equipment, and fixtures. However, the Defendant paid a certain amount of the commission fee to the sales store in preparation for the loss or damage of the goods supplied to each sales store, after deducting a certain amount of the commission fee from the sales deposit. As such, the monthly accumulated sales deposit, in principle, was returned at the time of termination of the sales service contract, but was returned before.

H) In the event that a special sales event, etc. is held to require additional human resources in the store or where a short-term salesperson, such as Aarbrate, was employed to replace the holidays of the existing salesperson, the Defendant is the person who finally bears the allowance to be paid to the short-term salesperson. However, it was not impossible for the existing salesperson to replace the sales business by a third party, and the Defendant did not prohibit it.

(i) The Plaintiffs did not apply the rules of employment of the Defendant, but paid business income tax that is not earned income tax, and did not subscribe to so-called four major insurance, such as industrial accident compensation insurance and employment insurance.

3) In light of the legal principles as seen earlier, the following circumstances revealed by comprehensively taking account of the aforementioned facts acknowledged and the evidence as seen earlier, and the Nonparty’s testimony of the Nonparty witness, it is insufficient to view the Plaintiffs as workers under the Labor Standards Act who provide labor for the purpose of wages in subordinate relationship with the Defendant, and there is no other evidence to acknowledge otherwise.

① On August 2005, the sales clerks who previously worked as the Defendant’s employees entered into a sales service agreement to submit a resignation document and receive retirement allowances, and then receive fees according to the sales amount. This is interpreted as an intention to resolve a labor relationship, and such intent should be respected.

② The Defendant concluded a sales service agreement with the department store operating companies to delegate the sales business to the Plaintiffs in accordance with a special contract purchase agreement entered into with the department store operating companies. In general, it is sufficiently possible for the delegation contract to delegate the business affairs set forth in the specific time and place. As such, the Plaintiffs’ place of business is the department store, and the hours of business are determined as hours and place due to the characteristics of the department store sales business, and it does not go against the nature of delegation.

③ The method of sales business conducted by the Plaintiffs was not subject to considerable direction and supervision by the Defendant, but rather conducted according to the Plaintiffs’ individual discretion and capacity, and the operation of the store was, in principle, entrusted to the Plaintiffs. Even if the Defendant’s headquarters regularly visited the department store, this appears to have been conducted at the minimum level of inspection conducted by the Defendant as the support for sales display or as the truster’s status, and thus, it is not deemed that the Plaintiffs were subject to considerable direction and supervision by the Defendant

④ The Defendant did not manage the status of ordinary salespersons’ attendance and retirement, and there was a lack of any requirement for temporary entry to work, but did not verify or impose sanctions on them. In addition, even in the case of delegation, the mandatory should report the status of delegated affairs upon the request of the mandator (Article 683 of the Civil Act), and the said request for temporary entry into work does not significantly deviate from the scope of exercising the right to claim by such mandator.

⑤ Although the Plaintiffs notified the Defendant’s head office of the use of the leave, it is not for obtaining prior permission on the leave, but for cooperation in business.

(6) In preparation for the loss or damage of goods supplied to each store, the defendant paid a certain amount of the commission to salespersons after deducting it as a security deposit for sale, which is different from the form of payment for general workers.

7) The fee paid by the Defendant is basically a structure determined in proportion to the outcome of the performance of the duties performed by the salesperson. The fact that the Defendant paid fees calculated by multiplying the monthly sales by a certain fee rate to the monthly sales by the salesperson, while setting the upper limit and lower limit in the amount of the fee, is recognized as having paid fixed wages at a certain time. However, this was a measure taken in consideration of the fact that the Defendant’s goods sold are highly low monthly sales in light of the characteristics of the goods sold, or taken temporarily upon the request of the salesperson under special circumstances such as economic depression. Furthermore, this is understood as reflecting such characteristics as the demand for performance of duties for a certain period of time due to the content and characteristics of the sales service contract, and it is sufficiently possible for the Defendant to agree to pay fixed remuneration in accordance with the content and characteristics of the delegated duties. Therefore, it cannot

8. It seems that there is no special obstacle to allowing the Plaintiffs to act on behalf of them through short-term salespersons, such as part-time sales, depending on their personal circumstances.

9. The plaintiffs were not subject to the rules of employment of the defendant, and the defendant did not have or exercise the right to discipline against the plaintiffs.

(10) The Plaintiffs paid the business income tax, and did not subscribe to the so-called four major insurance.

① Although the Defendant paid a certain amount of money to the Plaintiffs on the Workers’ Day, it cannot be a factor that has a weight in determining whether the Plaintiffs are subordinate to the Plaintiffs.

B. Sub-determination

Therefore, the plaintiffs' claims against the defendant for the payment of retirement allowances on the premise that the plaintiffs constitute workers under the Labor Standards Act are without merit without further review.

5. Conclusion

Therefore, all of the plaintiffs' claims in this case are dismissed due to the lack of grounds, and since the judgment of the court of first instance is unfair with some different conclusions, the defendant's appeal is accepted, and the part against the defendant in the judgment of the court of first instance is revoked and all of the plaintiffs' claims corresponding to the revoked part are dismissed, and it

[Attachment]

Judges Kim Jin-jin (Presiding Judge)