[1] Whether annual leave allowances that an employer can claim as a result of the worker's failure to use his/her annual leave constitutes wages (affirmative in principle), and the method of determining whether the worker has worked at least 80 percent per year (affirmative in principle)

[2] The method of calculating the number of days of annual paid leave in a case where a worker does not actually provide labor by taking a legitimate industrial action or by taking a child care leave under the Equal Employment Opportunity and Work-Family Balance Assistance Act

[1] Article 60(1) of the Labor Standards Act provides that “an employer shall grant 15-day paid leave to an employee who has worked not less than 80 percent per year.” This purpose is to exempt an employee from his/her duty of work for a certain period of time so as to provide an employee with mental and physical recreation and improve cultural life. Such annual paid leave does not necessarily mean that the employee can naturally be guaranteed, but can only be granted when he/she worked not less than 8 percent per year. Unless otherwise expressly provided, it can be deemed that the annual paid leave is a remuneration for one year. The annual paid leave which the employee can claim against the employer as he/she prevents the employee from using his/her annual paid leave. Here, whether an employee has worked not less than 8 percent per year is determined on the basis of the number of days excluding days determined by Acts and subordinate statutes, collective agreements, employment rules, etc., the number of days remaining after the employee has no duty of work for a certain period of time, namely, the number of days of annual paid working hours (hereinafter referred to as “annual days”).

[2] In a case where an employee does not actually provide his/her labor due to a legitimate industrial action or a childcare leave under the Equal Employment Opportunity and Work-Family Balance Assistance Act (hereinafter “Equal Employment Opportunity Act”), an industrial action, etc. is a legitimate exercise of workers’ rights guaranteed by the Constitution or Acts and subordinate statutes and the suspension of labor relations for a period of time, such as an industrial action, etc. by exercising said rights, and is legally prohibited from providing workers with unfair or unfavorable treatment for reasons of industrial action, etc. (Articles 3, 4, and 81 subparag. 5 of the Trade Union and Labor Relations Adjustment Act, Article 19(3) of the Equal Employment Opportunity Act, even if the employee did not provide his/her labor for a period of time including an industrial action, etc. included in the original annual fixed working days, such act cannot be deemed as absence from work by setting up the rate of annual paid leave when the employee did not actually provide his/her labor for that period, but the remaining number of days of working days during which the industrial action does not have the duty to improve the working hours per year, including the Labor Standards Act, Trade Union and Labor Relations Adjustment Act, etc.

[1] Articles 2(1)5 and 60(1) of the Labor Standards Act / [2] Article 33 of the Constitution of the Republic of Korea; Articles 3, 4, 44, and 81 subparag. 5 of the Trade Union and Labor Relations Adjustment Act; Article 19 of the Equal Employment Opportunity and Work-Family Balance Assistance Act; Articles 2(1)5 and 60(1) of the Labor Standards Act

[1] Supreme Court Decision 91Da14826 delivered on November 12, 1991 (Gong1992, 92) Supreme Court Decision 95Nu649 delivered on June 11, 1996 (Gong1996Ha, 2200) Supreme Court Decision 99Da10806 delivered on December 22, 2000

As shown in the Attached List of Plaintiffs (Attorney Jeon Young-young, Counsel for the plaintiff-appellant)

Algerz Life Insurance Co., Ltd. (Attorneys Kim Young-young et al., Counsel for the defendant-appellant)

Seoul High Court Decision 2010Na70676 decided December 10, 2010

All appeals are dismissed. The costs of appeal are assessed against the plaintiffs.

The grounds of appeal are examined.

1. Article 60(1) of the Labor Standards Act provides that “an employer shall grant 15-day paid leave to an employee who has worked not less than 80 percent per year.” This purport is to provide an employee with mental and physical recreation opportunities and to improve cultural life by exempting him from his duty of work for a certain period (see, e.g., Supreme Court Decision 95Nu6649, Jun. 11, 1996). Such annual paid leave does not necessarily mean that it is naturally guaranteed just because the employee has a relationship of providing labor, but can be granted only when he worked not less than 80 percent per year, and thus, it can be deemed that it is a remuneration for one year’s work, and that annual paid leave which can be claimed to an employer as the employee could not use his annual paid leave (see, e.g., Supreme Court Decision 91Da14826, Nov. 12, 191; Supreme Court Decision 2009Da869, Feb. 16, 2009).

In this context, whether an employee has worked for at least 80 percent of a year shall be determined on the basis of 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 the employee actually provided labor, i., the number of days during which the employee has an obligation to provide labor (hereinafter “annual fixed working days”). The number of annual fixed working days is based on the premise that the employee actually provided labor to the employer, i.e., the employee provided labor to the employer, and that the continuous provision of labor is scheduled.

Meanwhile, in a case where a worker does not actually provide labor due to a legitimate industrial action or a temporary retirement for childcare under the Act on the Equal Employment Opportunity and Work-Family Balance Assistance (hereinafter “Equal Employment Opportunity Act”), an industrial action, etc. is a legitimate exercise of the right guaranteed by the Constitution or Acts and subordinate statutes, and the suspension of a labor relationship for a period, such as an industrial action, etc. by exercising such right, and thus, the worker has no duty to provide labor, and it is legally prohibited to treat the worker unfairly or unfavorably on the ground of industrial action, etc. (Articles 3 and 4, subparagraph 5 of Article 81 of the Trade Union and Labor Relations Adjustment Act, Article 19(3) of the Equal Employment Opportunity Act, even if the worker did not provide labor for the period, such as an industrial action, which was included in the number of contractual working days per year, it cannot be deemed that the worker was absent from work. On the other hand, the Labor Standards Act, Trade Union and Labor Relations Adjustment Act, and the Equal Employment Opportunity Act do not provide that “the worker has actually provided labor during that period.”

Therefore, in such a case, comprehensively considering the purport of the annual paid leave system to guarantee workers’ legitimate exercise of rights, such as industrial action, etc. in accordance with the Constitution and relevant laws, as well as to provide workers with an opportunity for mental and physical recreation and to improve cultural life, while considering the fact that annual paid leave has the nature of consideration for one year’s work and there is no obligation to grant workers compensation for labor in principle during the period of industrial action, etc. for which no real labor has been provided, such as industrial action, etc., the amount of annual paid leave shall be calculated on the basis of the remaining number of days excluding the number of days of industrial action, etc. from the number of contractual working days per year to determine whether the requirements are met. However, if the requirements are met, it is reasonable to grant workers the annual paid leave days calculated by multiplying the number of days of annual paid leave calculated by dividing the “the number of days excluding the number of days of days of industrial action, etc. from the number of annual fixed working days” by the number of days of annual

2. The court below, based on its adopted evidence, acknowledged the facts as stated in its decision, and rejected all the plaintiffs' claims for an unpaid annual leave allowance on the premise that the Defendant calculated the Plaintiffs' attendance rate based on the period calculated by subtracting the number of annual leave days excluded from the number of regular working days from the number of regular working days and then multiplying the number of annual paid leave days by the number of annual paid leave days is lawful, and that the amount of annual paid leave days calculated by multiplying the number of annual paid leave days by the number of annual paid leave days is in violation of the Labor Standards Act.

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 it did not err by misapprehending the legal doctrine on interpretation and application of Article 60(1) of the Labor Standards Act.

3. Therefore, all appeals are 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 on the bench.

[Attachment] List of Plaintiffs: Omitted

Justices Park Poe-young (Presiding Justice)