[1] Where an employer and an employee agree to pay a certain amount of money as retirement allowance in monthly wages, whether it is effective as retirement allowance payment under Article 8(1) of the Guarantee of Workers' Retirement Benefits Act (negative)

[2] The case holding that the validity of the interim settlement of retirement allowances or interim settlement of retirement allowances cannot be recognized even if an employer agreed to pay the retirement allowances in the monthly wage as a whole when concluding an employment contract with workers, and received the “written application for interim settlement of retirement allowances” with the purport that “I wish to receive the retirement allowances after settling accounts at the time of receiving each month, and will not raise any objection to the retirement allowances to the company at the time of retirement”

[1] Articles 4 and 8(1) of the Guarantee of Workers' Retirement Benefits Act / [2] Articles 4, 8, and 31 of the Guarantee of Workers' Retirement Benefits Act, Article 34 of the Labor Standards Act

[1] Supreme Court Decision 2002Do2211 Decided July 12, 2002 (Gong2002Ha, 2008) Supreme Court Decision 2006Do3898 Decided September 22, 2006

Defendant

Defendant

Suwon District Court Decision 2007No571 Decided April 26, 2007

The appeal is dismissed.

The grounds of appeal are examined.

1. Articles 4 and 8(1) of the Guarantee of Workers' Retirement Benefits Act (hereinafter “the Act”) provide that an employer shall establish one or more retirement benefit systems to pay wages to retired workers, and an employer who intends to establish a retirement allowance system shall establish a system to pay the retired workers with at least 30 days’ average wages for one year of continuous employment as retirement allowances. As such, as retirement benefits arise only when a labor contract remains in existence as a requirement for termination of labor relations, there is no room for a duty to pay retirement allowances in principle during the period of employment. Thus, even if an employer agreed to pay a certain amount of money under the name of retirement allowances paid each month between the employer and the employee, it is not effective as retirement allowance payment as provided by Article 8(1) of the Act (see Supreme Court Decisions 2002Do2211, Jul. 12, 2002; 2006Do3898, Sept. 22, 2006, etc.).

2. Examining the record of this case in accordance with the above legal principles, the Defendant’s monthly wage of 70,000 won (in the case of the non-indicted workers) paid each month when entering into a labor contract with the instant workers, and the daily wage of 64,600 won and the retirement reserve of 5,400 won is agreed to receive the above retirement reserve on the monthly wage payment date, and the instant workers agreed to not raise any objection thereto. In addition, even if the agreement on retirement pay under the labor contract provides that “I wish to receive the retirement pay after settling accounts at the time of receiving each month’s pay, and would not raise any objection to the company regarding the retirement pay,” the Defendant’s written application for interim settlement of retirement allowance was received from the employees, stating that “I wish to receive the retirement allowance at the time of receiving each month, and would not raise any objection to the retirement allowance at the time of retirement,” and even if we did not acknowledge the validity of the payment of the monthly retirement allowance or interim settlement as to the retirement allowance under the above agreement.

The decision of the court below to the same purport is correct, and there is no error in the misapprehension of legal principles as to the interim settlement of retirement allowances, incomplete deliberation or violation of

3. Therefore, the appeal is dismissed. It is so decided as per Disposition by the assent of all participating Justices on the bench.

Justices Kim Nung-hwan (Presiding Justice)