[Plaintiffs, Appellants] Paradise Jeju Labor Union and 8 others (Attorney Kim Hyung-dong, counsel for the plaintiffs)
[Defendant, Appellee] Chairman of the National Labor Relations Commission
[Intervenor for the Defendant] Paradise Jeju Co., Ltd. (Kim Yeon-tae and 3 others, attorneys of Law Firm ACE, counsel for the intervenor)
[Judgment Below] Seoul High Court Decision 2007Nu27570 rendered on July 9, 2008
[Order]
The appeal is dismissed. The costs of the appeal, including those arising from the intervention, shall be borne by the plaintiffs.
[Reasoning] The grounds of appeal (including the supplementary brief on grounds of appeal filed after the expiration of the period for submitting the grounds of appeal, to the extent that it supplements the grounds of appeal) are examined as follows.
1. As to the grounds of appeal concerning unfair dismissal
A.
Under Article 31, Paragraphs 1 through 3 of the former Labor Standards Act (근로기준법) (before amendment by Act No. 8293 of January 26, 2007; hereinafter the same), where an employer intends to dismiss employees for managerial reasons, i.e., to carry out a redundancy dismissal (정리해고), there must be an urgent managerial necessity, the employer must make every effort to avoid the dismissal, the employer must select the persons to be dismissed according to reasonable and fair standards, and the employer must notify the labor union organized by a majority of the employees or the employee representative of the methods to avoid dismissal and the criteria for dismissal, etc., at least 60 days prior to the date of dismissal, and must engage in sincere consultation. However, the specific content of each of these requirements is not fixed or absolute but is determined flexibly in relation to the degree of fulfillment of the other requirements in each specific case. Therefore, whether a redundancy dismissal in a specific case satisfies all of the above requirements and is therefore justified must be determined by comprehensively considering the individual circumstances constituting each of the above requirements (see, e.g., Supreme Court Decision 2003Da69393 rendered on January 26, 2006).
B. According to the reasoning of the first instance judgment cited by the court below, the court below, after finding the facts as stated in its judgment, recognized that there was an urgent managerial necessity to carry out the redundancy dismissal in this case, in light of the facts that the Intervenor Company (hereinafter referred to as “the Intervenor Company”) had incurred deficits of more than 2 billion won every year since 2000, resulting in an accumulated deficit of 10 billion won by 2005, that its sales continued to decline, that its debt ratio greatly exceeded the average debt ratio of the lodging industry as a whole, and that the proportion of its labor costs had increased, making cost reduction urgently necessary. Such factual findings and determination by the court below are justified and may be upheld.
C.
The method and degree of efforts to avoid dismissal that an employer must exert before carrying out a redundancy dismissal vary depending on the degree of the employer’s managerial crisis, the managerial reasons necessitating the redundancy dismissal, the nature and scale of the business, the personnel status by job grade, etc. Therefore, such circumstances must be taken into account in determining whether the redundancy dismissal satisfies the requirement of efforts to avoid dismissal (see, e.g., Supreme Court Decision 2005Da30580 rendered on September 22, 2006).
Considering the circumstances recognized by the reasoning of the first instance judgment cited by the court below and the record — namely, that in the face of the aforementioned managerial crisis, the Intervenor Company took measures to reduce costs, such as partial return of executives’ salaries, disposal of supplies, implementation of unpaid leave and voluntary retirement, and promotion of real estate sales, and that it requested cooperation from affiliated companies for preferential hiring of employees subject to dismissal, while reducing the initially planned number of persons to be dismissed from 36 to 17 — it may be said that the Intervenor Company made every effort to avoid dismissal in carrying out the redundancy dismissal at issue in this case.
Meanwhile, as recognized by the reasoning of the first instance judgment cited by the court below and the record, the hotel business division and the casino business division of the Intervenor Company had separate rules of employment, separate personnel management, and separate labor unions organized for each business division, such that they were operated separately; and personnel exchanges between the hotel business division and the casino business division in the past occurred only within a very narrow scope and cannot be regarded as customary, and moreover, no such personnel exchange took place around the time of the redundancy dismissal in this case. In light of these circumstances, it cannot be said that the Intervenor Company failed to make every effort to avoid dismissal merely because it did not reassign personnel to the casino business division.
Furthermore, according to the record, at the time of the redundancy dismissal in this case, the Intervenor Company was using dispatched workers (파견근로자) at the hotel in question, and such use of dispatched workers was an unlawful dispatch that failed to meet the requirements of the former Act on the Protection, etc. of Dispatched Workers (2006. 12. 21. 법률 제8076호로 개정되기 전의 것, hereinafter “former Dispatched Workers Protection Act”), and it can be seen that some of the said dispatched workers had already worked for more than two years. However, since the deemed direct employment provision under Article 6, Paragraph 3 of the former Dispatched Workers Protection Act applies even in the case of unlawful dispatch (see, e.g., Supreme Court en banc Decision 2007Du22320 rendered on September 18, 2008), it may be considered that a direct employment relationship was established between such dispatched workers who worked for more than two years and the Intervenor Company by application of the deemed direct employment provision. Considering this point, together with the cause and background of the redundancy dismissal in this case, and the various other measures taken by the Intervenor Company to minimize the scale of dismissal, it cannot be concluded that the Intervenor Company failed to make every effort to avoid dismissal merely because it did not terminate such dispatched labor relationships.
The court below’s determination, in the same vein, that the Intervenor Company made every effort to avoid dismissal is justified.
D.
The reasonable and fair standards required in selecting persons subject to redundancy dismissal vary depending on the intensity of the managerial crisis faced by the employer, the managerial reasons necessitating the redundancy dismissal, the nature of the business division in which the redundancy dismissal was carried out and the composition of the employees, and the socio-economic circumstances at the time the redundancy dismissal was carried out. In addition, the purpose of Article 31, Paragraph 3 of the former Labor Standards Act, which provides the procedural requirement that the employer must notify in advance and engage in sincere consultation with the employee representative of the business or workplace concerned regarding the methods to avoid dismissal and the criteria for dismissal, etc., is to ensure the fulfillment of the substantive requirements provided in Paragraphs 1 and 2 of the same Article, and also to reflect the intent that even an inevitable redundancy dismissal is desirably carried out with mutual understanding achieved through a process of consultation (see, e.g., Supreme Court Decision 2001Da29452 rendered on July 9, 2002).
According to the reasoning of the first instance judgment cited by the court below, the court below, after finding the facts as stated in its judgment, determined that the criteria for selecting persons subject to dismissal established by the Intervenor Company, in terms of their constituent items and the point allocation for each item, appropriately took into account both the business’s managerial interests and the employees’ personal circumstances, and excluded arbitrary or subjective elements, thereby constituting, on the whole, reasonable and fair standards; and further determined that the Intervenor Company held labor-management council meetings with Plaintiff Paradise Jeju Labor Union on several occasions to implement the redundancy dismissal in this case, requesting consultation and the presentation of opinions regarding the redundancy dismissal, thereby undergoing sincere consultation with the employee representative. Such factual findings and determination by the court below are justified and may be upheld.
E. Accordingly, the court below’s determination that the redundancy dismissal in this case satisfied all of the requirements is justified, and there is no error of law, such as a mistake of fact or misapprehension of the legal principles concerning redundancy dismissal, as alleged in the grounds of appeal.
2. As to the grounds of appeal concerning unfair labor practice
In a case where it is recognized that an employer, in dismissing an employee, actually dismissed the employee because of the employee’s legitimate labor union activities, notwithstanding the dismissal grounds ostensibly asserted, such dismissal must be regarded as an unfair labor practice. However, in a case where an employee was dismissed on legitimate grounds for dismissal, even if there are traces that the employer viewed the employee’s labor union activities with disfavor, or even if an anti-union intent on the part of the employer is presumed, it cannot be said that the grounds for dismissal were merely a pretext on the surface, and therefore such dismissal cannot be deemed to constitute an unfair labor practice (see Supreme Court Decision 98Da54960 rendered on June 23, 2000).
In light of these legal principles and the record, the court below’s determination, citing the first instance judgment, that the redundancy dismissal in this case does not constitute an unfair labor practice is justified, and there is no error of law, such as misapprehension of the legal principles concerning unfair labor practice, as alleged in the grounds of appeal.
3. Conclusion
Therefore, the appeal is dismissed, and the costs of the appeal are to be borne by the losing party. This judgment is rendered as per the Order by the unanimous opinion of the participating Justices.
Justice Shin Young-cheol (Presiding Justice), Park Si-hwan, Ahn Dae-hee (Justice in charge), Cha Han-sung