Last Updated March 08, 2019

Law and Practice

Authors



Yoon & Yang LLC (Seoul - HQ) 's Employment and Labour Practice Group consists of 17 attorneys and other professionals who all concentrate solely on employment issues. The type of issues that the Practice Group has recently represented are illegal worker dispatches, discriminations among different type of workers, implementation of performance-based salary system, protection of non-regular workers, and ordinary wage issues. The firm's key areas of practice are general HR issues, including performance-based salary systems, labour union activities, collective bargaining agreements and disciplinary regulations, employment issues in mergers and acquisitions, employment issues on corporate restructuring, representation in labour disputes in civil, criminal and administrative proceedings.

Notice Periods

As noted above, employers must, pursuant to Article 26 of the Labor Standards Act, give an employee a prior notice of at least 30 days if the employer intends to dismiss such employee. This notice requirement applies also to dismissals caused by managerial reasons. In addition, much like procedures for taking disciplinary actions, employers are required to provide a prior notice (usually one week before the meeting) that an HR committee meeting will be held. Other than the foregoing, the Labor Standards Act does not provide for a mandatory notice period. However, if the employer provides for a separate notice period in its rules of employment that are not required by the law, then such procedures must be complied with.

Severance

If an employer fails to give the requisite prior notice of 30 days prior to dismissing an employee, then the employer must pay the employee an additional sum of money equivalent to at least 30 days’ worth of the employee’s ordinary wages pursuant to Article 26 of the Labor Standards Act.

Also, aside from the foregoing requirements to provide a prior notice and to pay additional allowances for failing to provide a prior notice, there are additional severance pay-related requirements under the Act on the Guarantee of Workers' Retirement Benefits (the “Retirement Benefits Act”). The Retirement Benefits Act requires employers to provide severance payments or retirement pensions to resigning employees who have been employed for at least one year. To provide the foregoing payments or pensions, an employer is required to operate a retirement-benefit scheme in accordance with the Retirement Benefits Act. In particular, if an employee dies or retires, Article 36 of the Labor Standards Act requires an employer to pay the wages, compensations and other money or valuables to the employee within 14 days after the death or retirement of the employee. This 14-day payment period may be extended by mutual agreement between the parties concerned if there are special circumstances.

With regard to dismissals of employees, the Labor Standards Act only requires the employer to provide a prior notice of 30 days to the relevant employee (Article 26) and to notify the detailed reason for, and timing of, the dismissal in writing (Article 27). As such, no separate procedures such as obtaining external advice or authorisation need to be taken. However, if the employer provides for additional procedures for employee resignations (including dismissals etc) through collective agreements, rules of employment, employment contracts or other relevant agreements, then the employer must comply with such procedures.

Yoon & Yang LLC

ASEM Tower, 517 Yeongdong-daero
Gangnam-gu
06164
Seoul
Korea

+82 2 6003 7000

+82 2 6003 7800

yoonyang@yoonyang.com www.yoonyang.com
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Authors



Yoon & Yang LLC (Seoul - HQ) 's Employment and Labour Practice Group consists of 17 attorneys and other professionals who all concentrate solely on employment issues. The type of issues that the Practice Group has recently represented are illegal worker dispatches, discriminations among different type of workers, implementation of performance-based salary system, protection of non-regular workers, and ordinary wage issues. The firm's key areas of practice are general HR issues, including performance-based salary systems, labour union activities, collective bargaining agreements and disciplinary regulations, employment issues in mergers and acquisitions, employment issues on corporate restructuring, representation in labour disputes in civil, criminal and administrative proceedings.

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