The Suwon District Court in Korea recently ruled that a subcontracting arrangement between Company B and its subcontractor, Company C, constituted an illegal worker dispatch and ordered Company B to compensate the employees of Company C for the discrepancies in wages between workers working for Company B and workers at Company C. The lawsuit was filed by former employees of Company C and highlights the legal implications and risks of Korean subcontracting arrangements in violation of Korean labor laws and Korean court precedence. For an article on
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Korean Statute of Limitations for Unpaid Wages in Illegal Worker Dispatch Cases in Korea
The Supreme Court of Korea ruled in April of 2023 for the first time on the statute of limitation for damages claims based on an illegal dispatch of workers in Korea. The Supreme Court of Korea ruled that the statute of limitations clause under Article 766 of the Korean Civil Code and not the statute of limitations clause under Article 49 of the Korean Labor Standards Act should be applied to unpaid wage claims filed by a subcontractor’s employee against the Contracting Company (Supreme Court Decision 2021Da213477,
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