[Plaintiffs, Appellants]
[Defendant, Appellee] Suwon City (Attorneys for the litigation: Haemaru Law Firm, Attorney Jeon Hae-cheol and 2 others)
[Judgment Below] Seoul High Court Decision 2010Na5894 decided August 19, 2011
[Order]
The part of the judgment below against the Plaintiffs shall be reversed, and this part of the case shall be remanded to the Seoul High Court.
[Reasoning] The grounds of appeal are examined.
1. As to Ground of Appeal No. 1
Interim settlement of retirement benefits under Article 8(2) of the Act on the Guarantee of Employees' Retirement Benefits (근로자퇴직급여 보장법) is established where an employee requests interim settlement of retirement benefits for all or part of his or her continuous service period up to that point and the employer approves the interim settlement for the requested period, at which time the right to claim interim settlement retirement benefits for the relevant period of service arises (see Supreme Court Decision 2006Da20542 decided February 1, 2008, etc.). Therefore, even if, after an interim settlement of retirement benefits has been established, wages are retroactively increased effective from a date prior to the reference date of the interim settlement pursuant to an agreement between labor and management, and thus the effect of the wage increase arises retroactively, such retroactive effect of the wage increase cannot be deemed to naturally affect the legal relationship concerning the already-established interim settlement of retirement benefits, absent special circumstances such as an agreement between the employer and the employee to recalculate the interim settlement of retirement benefits based on the increased wages.
The court below determined that, since the Defendant had already completed the interim settlement of retirement benefits for the Plaintiffs before the labor-management agreement determining the wage increase was reached, and since there is no recognized special circumstance suggesting that the Defendant agreed with the Plaintiffs or with the National Democratic Federation of Trade Unions to which the Plaintiffs belonged to recalculate the interim settlement retirement benefits based on the increased wages, the Defendant has no obligation to recalculate the interim settlement retirement benefits based on the increased wages and pay the Plaintiffs the difference from the interim settlement retirement benefits already paid; and therefore, the Plaintiffs are obligated to return to the Defendant, as unjust enrichment, the money additionally paid to them by the Defendant in the name of interim settlement retirement benefits. In light of the legal principles set forth above, this determination by the court below is justified, and there is no error therein, as alleged in the grounds of appeal, in misunderstanding the legal principles concerning interim settlement of retirement benefits.
Supreme Court Decision 2001Da54977 decided May 16, 2003, cited in the grounds of appeal, differs in its facts from the present case and is not appropriate to be invoked herein.
2. As to Ground of Appeal No. 2
The argument in this part of the grounds of appeal is to the effect that Article 23-3(2) of the 2005 Collective Agreement, which formed the basis of the interim settlement of retirement benefits in this case, providing that "no employee shall receive any disadvantageous treatment, such as with respect to seniority allowance, annual leave, etc., compared to other union members with the same hire date, on account of the interim settlement of retirement benefits," can be interpreted as constituting a special agreement between the parties to pay the difference from the interim settlement retirement benefits already paid in the event of a retroactive wage increase. However, this argument is being raised for the first time at the appellate stage before this Court and does not constitute a lawful ground of appeal.
3. As to Ground of Appeal No. 3
A. First, among the arguments in this part of the grounds of appeal, the argument to the effect that even if the money additionally paid by the Defendant to the Plaintiffs in the name of interim settlement retirement benefits, pursuant to the wage agreement concluded after the interim settlement of retirement benefits, does not have effect as payment of the difference in interim settlement retirement benefits, it nonetheless has effect as payment of wages, is being raised for the first time at the appellate stage before this Court and cannot constitute a lawful ground of appeal.
B. Meanwhile, upon examining the record in light of the relevant legal principles, it is proper that the court below, on the premise that it was not established that the Defendant knew, at the time it additionally paid the Plaintiffs the money in the name of interim settlement retirement benefits pursuant to the wage agreement providing for a retroactive wage increase, that it had no obligation to make such payment, recognized the Defendant's right to claim restitution of unjust enrichment equivalent to the money so additionally paid in the name of interim settlement retirement benefits. There is no error therein, as alleged in the grounds of appeal, in misunderstanding the legal principles concerning the establishment of a right to claim restitution of unjust enrichment in cases of non-debt payment (비채변제).
4. As to Ground of Appeal No. 4
A. Under the main text of Article 43(1) of the Labor Standards Act (근로기준법), wages must be paid directly to the employee in full in currency, and as a rule, an employer may not set off its claim against an employee against the employee's wage claim. However, where wages have been overpaid due to a calculation error or the like, if the employee claims, after retirement, wages or retirement benefits not received during his or her employment, or even where the employee claims wages while still employed, provided that the time of the overpayment and the time of exercise of the right to set-off are close enough that the setoff does not lose the character of a settlement or adjustment of wages, and further, the employer gives advance notice of the amount and method of the setoff so that there is no risk of harming the employee's economic stability of living, the employer may set off its right to claim the return of the overpaid wages, as the active claim, against the employee's wage claim or retirement benefit claim. Accordingly, where an employee claims unpaid statutory allowances for a certain period, it is also permissible for the employer to assert set-off or appropriation on the ground that there was an overpayment of statutory allowances during the same period (see Supreme Court en banc Decision 94Da26721 decided December 21, 1995, etc.).
Meanwhile, Article 246(1)(4) of the Civil Execution Act (민사집행법), for the public and social policy purpose of guaranteeing the livelihood of a debtor who is an employee, designates as a claim exempt from seizure "an amount equivalent to one-half of a claim for wages, pensions, salary, bonuses, retirement pensions, or other claims for payment of a similar nature (provided that where such amount is less than the amount prescribed by Presidential Decree taking into account the minimum cost of living under the National Basic Living Security Act, or exceeds the amount prescribed by Presidential Decree taking into account the cost of living of a standard household, the amount prescribed by the relevant Presidential Decree shall apply in each case)," and Article 497 of the Civil Act (민법) provides that a debtor of a claim exempt from seizure may not assert set-off against a creditor. Accordingly, it is reasonable to view that where an employer sets off its right to claim restitution of unjust enrichment equivalent to the amount of wages overpaid to an employee due to a calculation error or the like, as the active claim, against the employee's wage claim, such set-off is permissible only with respect to the amount corresponding to the portion exceeding one-half of the wage claim (see Supreme Court en banc Decision 2007Da90760 decided May 20, 2010).
B. The court below accepted in full the Defendant's set-off defense, whereby the Defendant asserted set-off, as active claims, not only of its claim for restitution of unjust enrichment equivalent to the money additionally paid to the Plaintiffs in the name of interim settlement retirement benefits based on the retroactively increased wages, but also of its claim for restitution of unjust enrichment equivalent to the amount overpaid to Plaintiff 1 due to an error in excessively including his military service period in his years of service when the interim settlement retirement benefits were originally paid, and its claim for restitution of unjust enrichment equivalent to the amount overpaid to Plaintiff 2 due to excessive inclusion of bonuses, respectively, against the Plaintiffs' wage claims. The court below then determined that the Defendant was obligated to pay the Plaintiffs the remaining amount after deducting from each Plaintiff's wage claim amount the total amount of the above active claims for set-off.
In light of the legal principles set forth above, it is acceptable that the court below found that the Defendant could set off, as an active claim, its claim for restitution of unjust enrichment equivalent to the money additionally paid in the name of interim settlement retirement benefits against the Plaintiffs' wage claims, and in such a case, it should not be held that the passive claim is limited to the Plaintiffs' retirement benefit claims, or that a statutory allowance claim arising from a different basis of payment cannot serve as a passive claim.
However, since the Defendant's above set-off defense uses the Plaintiffs' wage claims, as employees, as the passive claim, in light of the legal principles set forth above, it is permissible only with respect to the amount corresponding to the portion exceeding one-half of the wage claim.
Meanwhile, even in the case of set-off, the legal principles concerning appropriation of performance under Articles 476 and 477 of the Civil Act apply mutatis mutandis pursuant to Article 499 of the Civil Act, and where set-off is asserted, res judicata arises with respect to the amount asserted for set-off regardless of whether the set-off is accepted or not (Article 216(2) of the Civil Procedure Act (민사소송법)). Accordingly, where a set-off defense based on multiple active claims is found to have merit and the principal and interest of the passive claim do not reach the total principal and interest of the active claims, it is necessary at the very least to clarify whether the appropriation for set-off is to be made by designation or by statutory appropriation, and if it is to be made by designation, to specify which active claim is to be appropriated first (see Supreme Court Decision 2011Da24814 decided August 25, 2011).
However, according to the record, it can be seen that the total amount of the above active claims for set-off (that is, referring to the money each of the Plaintiffs received in excess and additionally from the Defendant in the name of interim settlement retirement benefits) exceeds one-half of each Plaintiff's wage claim amount. Therefore, the court below should have specified the amount corresponding to one-half of the wage claim, which is a claim exempt from seizure and to that extent subject to restriction on set-off, and permitted set-off only within the range exceeding that amount, and should also have specified which of the above active claims for set-off is extinguished by set-off and to what extent.
Accordingly, the court below's action in accepting the Defendant's set-off defense in full amounts to an error affecting the judgment, in that it misunderstood the legal principles concerning exemption from seizure and restriction on set-off, res judicata of set-off, or appropriation for set-off, and failed to conduct the necessary examination or omitted judgment thereon. The grounds of appeal in this part, which include this point, are with merit.
5. Conclusion
Therefore, the part of the judgment below against the Plaintiffs is reversed, and this part of the case is remanded to the court below for further hearing and determination, and it is so decided by the unanimous opinion of the Justices participating in the decision, as set forth in the Order.
Justice Park Bo-young (Presiding Justice), Min Il-young, Kim Shin, Kwon Soon-il (Justice in charge)