Dismissal of Employees in Korea: Supreme Court of Korea Precedent

The Korean Supreme Court ruled, in March of 2018, that a company may terminate employees for one incident of employee gambling. The case is a precedent that may make it easier for employees to terminate employees that violate certain company rules without the need to provide notification and an opportunity to improve. The case stems from the termination of bus drivers that were caught on one occasion gambling prior to driving buses.

The lower courts ruled, in short, that gambling was not a serious enough offense to justify termination since:

The act of gambling, only, occurred on one occasion and thus trust between the employee and employer has not broken down;
The employees performed their job functions adequately; and
The non-termination of employment of the employees would not significantly interfere with the ability of the employer to successful continue its business- if the employees do not engage in these acts in the future.

Korean Supreme Court Holding

The Supreme Court reversed the decision of the lower court and noted that:

Gambling could effect the rest period of the drivers and the job of the drivers requires rest in order for the drivers to maintain the safety of passengers;
Gambling consumes mental and physical energy and is a task that, in of itself, may lead to a much less rested driver;
The employees may have gambled into the night and late into the morning prior to their shifts, thus, causing a substantial likelihood of causing drivers to lack adequate rest; and
The employees agreed, via a collective bargaining agreement, that gambling is grounds for termination and thus were aware of the ramifications for gambling.

IPG advises noting specific actions that is conduct that shall be grounds for termination. Point 4 of the Supreme Court opinion places emphasis on the fact that the collective bargaining agreement specifically noted that gambling is grounds for termination. Additionally, the Supreme Court of Korea seems to be placing specific emphasis on safety and it is recommended, if possible, to link the specific grounds for termination to a safety concern.

Because of recent changes in law we, highly, recommend an HR audit and a revision to your Employment Rules and an update to your employment education programs. Additional employment and labor law issues that may be useful to the reader may be found at: Korean Employment Law Archive.

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