It is well known that the Korean labor law provides the employees with generous protections when it comes to the matter of disciplinary measures taken by the employer. Unlike many other foreign legal regimes, Labor Standard Act of Korea (LSA) requires the employer of five or more employees to establish a just cause for a dismissal and any other disciplinary actions. In other words, the employment is not “at-will” in Korea. (Note: There is a legal concept of no fault dismissal based on the managerial hardship under the LSA, which requires very strict requirements to execute. This will be the subject of our upcoming article)
This rule of law shall equally apply to the employment contract between Korean employer and Foreign employee in Korea, and vice versa. More importantly, this is the case even when the employee working in Korea agrees in his employment contract that the Korean labor law does not apply. That is because the Private International Act of Korea which provides the general principles for the choice of law in Korea enables every Korean and foreign employee working in Korea to enjoy the very protections under the mandatory rules of the Korean labor law. Therefore, it is highly advisable that any foreign employee working in Korea and a multinational which has employees in Korea must understand how the Korean labor law regulates the dismissal and under what situation the dismissal becomes a wrongful termination.
Then What is the Just Cause for Dismissal in Korea?
The LSA does not provide what the just cause exactly means. It is up to the court’s review and the decision thereafter. That said, it is firmly established in the Supreme Court’s precedent that Continue reading