[Plaintiff, Appellant] Plaintiff (Attorney Kim Won-jin, Counsel for the Plaintiff)
[Defendant, Appellee] National Agricultural Cooperative Federation
[Judgment Below] Seoul High Court Decision 2003Na29427 rendered on October 23, 2003
[Order]
The part of the judgment below against the Plaintiff concerning the wage claim for the period from January 1, 2000 to August 19, 2001 is reversed, and this part of the case is remanded to the Seoul High Court. The Plaintiff's remaining appeal is dismissed.
[Reasoning]
1. Facts
According to the facts lawfully established by the court below by citing the reasoning of the first instance judgment and the record, the following facts may be known.
A. The Plaintiff was newly employed by the National Livestock Cooperatives Federation (hereinafter "Livestock Cooperatives") on November 3, 1987, and while working there, was arrested on August 6, 1998 on suspicion of occupational breach of trust. The suspected facts were as follows: "While the Plaintiff was working as the finance manager at the Seoul Branch of the Livestock Cooperatives, in conspiracy with a non-party who was the sales manager of the said branch, in extending a loan from the Livestock Development Fund to Bukwon Agricultural Products Co., Ltd. around September 1997, in breach of his occupational duty to confirm that Bukwon Agricultural Products had invested its own contribution and to secure sufficient collateral before extending the loan, while recognizing the possibility that the receipt for advance construction payment, which served as the basis for the claim that Bukwon Agricultural Products had invested KRW 2 billion of its own contribution, had been falsely prepared, nevertheless extended a loan of KRW 3.62 billion while securing only real estate collateral with an appraised value of KRW 1.225 billion without obtaining any other collateral, thereby causing property damage to the Livestock Cooperatives equivalent to the amount of the said loan."
B. Article 32, Item 3 and Article 33, Item 3 of the Personnel Regulations of the Livestock Cooperatives classified the types of leave of absence into sick leave, military service leave, ordered leave, childcare leave, requested leave, study abroad leave, etc., and provided that "when a person is detained or indicted for a criminal case, ordered leave may be granted until one month after the judgment becomes final." When the Plaintiff was detained as above, the Livestock Cooperatives, applying the said Personnel Regulations, placed the Plaintiff on ordered leave on August 14, 1998.
C. The Plaintiff was released on September 1 of the same year upon the prosecutor's cancellation of detention, and when he was indicted without detention for violation of the Act on the Aggravated Punishment, etc. of Specific Economic Crimes (Breach of Trust), he applied to the Livestock Cooperatives for reinstatement around that time, but the Livestock Cooperatives did not accept this.
D. In the said criminal case, the Plaintiff was sentenced to 2 years' imprisonment with 3 years' suspension of execution at the first instance on November 6, 1998, and to 1 year and 6 months' imprisonment with 3 years' suspension of execution at the appellate instance on February 23, 1999, both guilty verdicts. However, the Supreme Court reversed and remanded the said appellate judgment on April 27, 2001, and upon remand, the appellate court, on July 20 of the same year, rendered a not-guilty verdict for the Plaintiff on the ground that, apart from whether the Plaintiff was negligent in connection with the said loan to Bukwon Agricultural Products, he did not intentionally breach his occupational duty, and that judgment became final on the 28th of the same month.
E. Meanwhile, on January 28, 1999, the Livestock Cooperatives convened a Compensation Adjudication Committee regarding the Plaintiff, but decided to reserve the decision until the amount of the Livestock Cooperatives' loss was accurately calculated, to be reconsidered later.
F. The Defendant, established pursuant to the Agricultural Cooperatives Act (농업협동조합법), which was enacted as Act No. 6018 on September 7, 1999 and took effect on July 1, 2000, comprehensively succeeded to the rights and obligations of the Livestock Cooperatives pursuant to Article 7, Paragraph 1 of the Addenda to the said Act, and also succeeded to the employment relationships with the employees of the Livestock Cooperatives, including the Plaintiff.
G. After the not-guilty judgment against the Plaintiff became final, the Defendant reinstated the Plaintiff on August 20, 2001, but on the same day, in order to convene a Personnel Committee to determine whether to impose disciplinary action or compensation measures against the Plaintiff, placed the Plaintiff on standby assignment. On January 3, 2002, when the grounds for the standby assignment were resolved, the standby assignment was lifted and the Plaintiff was ordered to work at the Defendant's Mokpo-Sinan-gun Branch.
H. Article 15, Paragraph 2, Item 1 and Article 16, Paragraph 1, Item 1 of the Defendant's Personnel Regulations, applicable to the Plaintiff from July 1, 2000, provide that "when a person is indicted for a criminal case, ordered leave may be granted until one month after the judgment becomes final," and Article 24, Paragraph 1, Item 4 provides that "when a matter falls under grounds for disciplinary action and is referred to the Personnel Committee, standby assignment may be ordered."
I. Article 7, Paragraph 2, Item 6 of the Livestock Cooperatives' Salary Regulations, which applied to the Plaintiff until March 31, 2001, provides that "no salary shall be paid during the period of ordered leave," while Article 8, Paragraph 2, Item 6 and Paragraph 4 of the Defendant's Employee Salary Regulations, applicable to the Plaintiff from April 1, 2001, provide that "an amount equivalent to 80% of the fixed salary shall be paid to those on ordered leave and those on standby assignment." The Defendant, pursuant to the Defendant's Employee Salary Regulations applicable to the Plaintiff from April 1, 2001, paid the Plaintiff an amount equivalent to 80% of the fixed salary, being the base salary plus position allowance, for the period of ordered leave and standby assignment from that date until January 2, 2002.
2. Judgment of the Court Below
The court below, with respect to this claim in which the Plaintiff sought payment of unpaid wages for the period from January 1, 2000 to January 2, 2002, arguing that after the cancellation of detention and release on September 1, 1998, the Plaintiff no longer fell under a case where he would be unable to provide labor for a considerable period or where it would be found very inappropriate for him to provide labor, and that therefore the measures of the Livestock Cooperatives and the Defendant in not accepting the Plaintiff's application for reinstatement and continuing to maintain the ordered leave lacked justifiable grounds and were void, held as follows. In light of the facts as shown above — namely, that the Plaintiff was detained on suspicion of causing damage to the Livestock Cooperatives by extending a loan from the Livestock Development Fund to Bukwon Agricultural Products in breach of his occupational duty; that the detention was not cancelled on the ground that the Plaintiff was not suspected; that the Plaintiff was found guilty at the first instance and appellate court in connection with the said loan; that the ground for the not-guilty verdict was that the Plaintiff lacked intent to commit occupational breach of trust in connection with the said loan, without any determination being made as to the existence of negligence; and that the Defendant's Personnel Committee was convened to discuss whether to take disciplinary action or compensation measures against the Plaintiff — the court below held that the Personnel Regulations of the Livestock Cooperatives and the Defendant, which allow ordered leave for employees indicted for criminal cases, cannot be interpreted as applying only to cases of indictment with detention and not to cases of indictment without detention. Accordingly, the court below held that the ordered leave and standby assignment imposed on the Plaintiff by the Livestock Cooperatives and the Defendant in accordance with the Personnel Regulations applicable to the Plaintiff were justified, and further that the restricted payment of salary in accordance with the Salary Regulations was also justified, and thus rejected the Plaintiff's claim in its entirety.
3. Judgment of This Court
However, it is difficult to accept the measure of the court below in rejecting the Plaintiff's claim in its entirety, for the following reasons.
A. Regarding the wage claim for the period of ordered leave
Leave of absence refers to a disposition by the employer whereby, when a cause arises making it impossible or inappropriate for a certain employee to perform his duties, the employee's status is maintained while he is prohibited from performing his duties for a certain period; such a leave system is customarily provided for in the employer's rules of employment or collective bargaining agreement. However, in light of the purport of Article 30, Paragraph 1 of the Labor Standards Act (근로기준법), which restricts an employer from placing an employee on leave without justifiable grounds, even where such leave-authorizing provisions grant the employer the power to order leave upon the occurrence of certain grounds for leave, and even where the prescribed grounds exist, justifiable grounds should be found to exist only where, taking into account all specific circumstances such as the purpose and actual function of the leave provision at issue, the reasonableness of the exercise of the power to order leave, and the disadvantages in status and economic terms that the employee would suffer as a result, it is found that the employee would be unable to provide labor for a considerable period, or that it would be very inappropriate for the employee to provide labor (see Supreme Court Decision 92Da16690 rendered on November 13, 1992).
In this case, the Plaintiff was detained on August 6, 1998, released on September 1 of the same year upon the prosecutor's cancellation of detention, and then indicted without detention. Since the Personnel Regulations of the Livestock Cooperatives and the Defendant provide that ordered leave may be granted until one month after the judgment becomes final "when a person is detained or indicted for a criminal case (Livestock Cooperatives)" or "when a person is indicted for a criminal case (Defendant)," insofar as the Plaintiff was detained for a criminal case and then indicted without detention, the ground for ordered leave prescribed in the Personnel Regulations of the Livestock Cooperatives or the Defendant itself had arisen. Furthermore, insofar as the Livestock Cooperatives regarded the Plaintiff, who was detained on suspicion of occupational breach of trust causing damage of KRW 3.62 billion, as falling under a case where he would be unable to provide labor for a considerable period, the ordered leave imposed by the Livestock Cooperatives may be viewed, absent other special circumstances, as having had justifiable grounds until the Plaintiff was released.
However, since the Plaintiff was not detained again after being released on September 1, 1998 upon the prosecutor's cancellation of detention, it is clear that the Plaintiff no longer fell under a case where he would be unable to provide labor for a considerable period, and the only remaining issue is whether it would be very inappropriate for the Plaintiff to provide labor. Article 34, Paragraph 1 of the Livestock Cooperatives' Personnel Regulations provides that "when an employee applies for reinstatement, reinstatement shall be ordered within 10 days absent special grounds," and Paragraph 2 of the same Article provides that "if reinstatement is not ordered within the period set forth in Paragraph 1, it shall be deemed an extension of the leave period." Since the Plaintiff, as noted above, applied to the Livestock Cooperatives for reinstatement after his release, taking into account all specific circumstances such as the purpose and actual function of the ordered leave provision, the reasonableness of the exercise of the power to order leave, and the disadvantages in status and economic terms that the Plaintiff would suffer as a result, only where it is found that it would be very inappropriate for the Plaintiff to provide labor for a considerable period could the measures of the Livestock Cooperatives in not accepting the Plaintiff's application for reinstatement, and of the Livestock Cooperatives and the Defendant in continuing to maintain the previous ordered leave, be evaluated as having justifiable grounds.
However, since the Salary Regulations of the Livestock Cooperatives provide that no salary shall be paid at all during the period of ordered leave, the continued maintenance of ordered leave for the Plaintiff, who was indicted without detention around September 1998, until around August 20, 2001, after the not-guilty verdict became final on July 28, 2001, can be seen as tantamount to dismissal in substance. Meanwhile, Article 35, Paragraph 1 of the Livestock Cooperatives' Personnel Regulations provides that standby assignment may be ordered when a person falls under one of the following: "a person whose work performance is extremely poor or whose work attitude is extremely unfaithful (Item 1), a person for whom disciplinary referral is being requested or who has been referred for disciplinary action (Item 3), a person in connection with a serious fraud or unusual accident where such measure is necessary for handling the matter or preventing its expansion and who is deemed likely to destroy evidence (Item 4), or other cases deemed unavoidable due to administrative circumstances (Item 7)," and Article 7, Paragraph 3 of the Livestock Cooperatives' Salary Regulations provides that a person who has received such standby assignment shall be paid the base salary. Even though there may be room to view that, since the Plaintiff was even detained on suspicion of occupational breach of trust allegedly causing KRW 3.62 billion in damage to the Livestock Cooperatives, and was indicted without detention and found guilty at both the first instance and appellate court, it was not appropriate to entrust the Plaintiff with the duties of the Livestock Cooperatives or the Defendant, Article 27, Paragraph 4 of the Constitution (헌법) provides that "a criminal defendant shall be presumed innocent until a guilty verdict is finalized," and the Plaintiff was ultimately found not guilty and that judgment became final, on the ground that intent to commit occupational breach of trust was not recognized. Furthermore, although the Plaintiff's negligence became an issue and the Plaintiff was referred to the Personnel Committee and the Compensation Adjudication Committee, there is no material to show that the Plaintiff actually received any disciplinary or compensation disposition thereafter. Considering all specific circumstances appearing in the record, including the fact that, under the Personnel Regulations and Salary Regulations of the Livestock Cooperatives, a person subjected to ordered leave under the ordered leave provision at issue in this case would, with respect to salary, etc., suffer a highly disadvantageous disposition tantamount to dismissal, and the period of approximately three years of the ordered leave at issue in this case, together with the purpose and actual function of the ordered leave provision at issue in this case, the reasonableness of the exercise of the power to order leave, and the disadvantages in status and economic terms that the Plaintiff would suffer as a result, the measure of exercising the power to order leave — thereby prohibiting the Plaintiff from providing any labor whatsoever — on the sole ground that the Plaintiff was indicted without detention for the aforementioned criminal facts, judging that it would be very inappropriate for the Plaintiff to provide labor, cannot but be regarded as a disposition lacking reasonableness under social norms. Furthermore, in light of the fact that although guilty verdicts were subsequently rendered at the first instance and appellate court, they were suspended-sentence judgments that did not impede the actual provision of labor, the mere fact that such judgments were rendered cannot be seen as giving rise to justifiable grounds for the ordered leave disposition. Moreover, even though the Plaintiff came to be subject, from April 1, 2001, to the Defendant's Employee Salary Regulations providing for payment of an amount equivalent to 80% of the fixed salary, being the base salary plus position allowance, to persons on leave, insofar as there was no change in the grounds for the ordered leave, this circumstance alone cannot be said to provide justifiable grounds for continuing to maintain the ordered leave disposition against the Plaintiff. Therefore, the ordered leave for the period from January 1, 2000, as sought by the Plaintiff, must be deemed void.
If so, since the Plaintiff cannot but be regarded as having been unable to perform his obligation under the employment contract to provide labor due to causes attributable to the Livestock Cooperatives or the Defendant during the period from January 1, 2000 until August 19, 2001, immediately before the standby assignment at issue in this case, the Plaintiff may claim payment of the wages he would have received had he continued to work during the said period.
Nevertheless, the court below, for the reasons stated in its judgment alone, determined that the ordered leave at issue in this case against the Plaintiff was justified, and rejected the Plaintiff's wage claim for the said period without further examination. Accordingly, the judgment below is illegal in that it misapprehended the legal principles concerning the effect of ordered leave and thereby failed to conduct the necessary examination, and it is clear that this illegality of the court below affected the judgment.
B. Regarding the wage claim for the period of standby assignment
Since it is indispensable for an enterprise, in order to continuously maintain its activities, to redeploy its workforce or adjust its labor supply and demand, personnel orders including standby assignment fall, in principle, within the inherent authority of the employer who holds the power of personnel management. Accordingly, considerable discretion must be recognized for the employer with respect to such personnel orders within the scope necessary for business purposes, and such orders cannot be deemed unlawful absent special circumstances such as violation of the Labor Standards Act or constituting an abuse of rights. Whether a standby assignment falls within the scope of a legitimate exercise of personnel authority must be determined by weighing the business necessity of the standby assignment against the disadvantages to the employee's living conditions resulting therefrom, and by considering whether procedures required under the good faith principle, such as consultation with the employee, were followed in the process of ordering the standby assignment. Whether a sincere consultation procedure was conducted with the employee concerned may be considered one factor in determining whether the exercise of personnel authority was legitimate, but the mere fact that such a procedure was not followed cannot be said to necessarily render the standby assignment void as constituting an abuse of rights (see, e.g., Supreme Court Decision 2000Du8011 rendered on December 26, 2002).
Examining the record in light of these legal principles, the Defendant's Personnel Regulations provide that standby assignment may be ordered when a matter falls under grounds for disciplinary action and is referred to the Personnel Committee. In this case, the Plaintiff was found not guilty in the criminal case on the ground that, apart from whether the Plaintiff was negligent, he did not intentionally breach his occupational duty; the Plaintiff was referred to the Personnel Committee in order to determine whether disciplinary action or compensation measures should be taken; and a person on standby assignment is to be paid an amount equivalent to 80% of the fixed salary, being the base salary plus position allowance. Under these circumstances, there are no special circumstances to find that the Defendant's standby assignment of August 20, 2001, imposed on the ground that the Plaintiff fell under grounds for disciplinary action and was referred to the Personnel Committee, violated the Labor Standards Act or constituted an abuse of rights. Therefore, the said standby assignment must be regarded as a legitimate and lawful exercise of personnel authority. In the same vein, the measure of the court below in rejecting the Plaintiff's wage claim for the period from the date of the said standby assignment until its lifting is justified, and there is no illegality therein, such as misapprehension of the legal principles concerning the effect of standby assignment, as asserted in the grounds of appeal.
4. Conclusion
Therefore, the part of the judgment below against the Plaintiff concerning the wage claim for the period from January 1, 2000 to August 19, 2001 is reversed, and this part of the case is remanded to the court below for further examination and determination. The Plaintiff's remaining appeal is without merit and is therefore dismissed. This Judgment is rendered as set forth in the Order by the unanimous opinion of the participating Justices.
Justice Kang Sin-uk (Presiding Justice), Byun Jae-seung, Park Jae-yun, Ko Hyun-cheol (Justice in Charge)