[Plaintiffs, Appellants] Plaintiff 1 and 3 others
[Defendants, Appellees] Jeil City Lease Co., Ltd. and 2 others
[Judgment Below] Seoul High Court Decision 93Na33977 rendered on March 31, 1994
[Order]
All appeals are dismissed. The costs of appeal shall be borne by the Plaintiffs.
[Reasoning]
We examine the grounds of appeal (the counter-brief dated September 12, 1994 is examined only to the extent it supplements the grounds of appeal).
In determining whether a person constitutes a worker under the Labor Standards Act (근로기준법), the determination must be made based on whether, in substance, the worker provided labor to the employer in a subordinate relationship for the purpose of wages at a business or workplace, regardless of whether the form of the contract is an employment contract or a contract for work under the Civil Act (민법). In determining whether such a subordinate relationship exists, the following factors must be comprehensively considered: whether the content of the work is determined by the employer and is subject to work rules or service (personnel) regulations, and whether the worker is subject to specific and individual direction and supervision by the employer in the course of performing the work; whether working hours and place of work are designated by the employer and whether the worker is bound thereby; whether there is substitutability of work, such as the worker himself hiring a third party to perform the work on his behalf; the ownership relationship regarding equipment, raw materials, or work tools; matters concerning remuneration, such as whether the nature of the remuneration is compensation for the labor itself, whether a base pay or fixed wage is set, and whether income tax on wage income is withheld at source; the continuity of the labor provision relationship and the existence and degree of exclusive affiliation with the employer; whether the person's status as a worker is recognized under other statutes such as those concerning the social security system; and the economic and social conditions of both parties.
According to the reasoning of the judgment below, the court below found, based on the evidence cited, the following facts: the Plaintiffs, each holding a business registration certificate as independent business operators, entered into subcontract agreements as indicated in the judgment with non-party Geumgu Industry Co., Ltd. (hereinafter "the non-party company"), which operates a steel structure manufacturing business, etc.; they agreed to receive wages according to the progress of construction at the 20%, 40%, 60%, and 80% completion stages and upon completion of construction, as indicated in the judgment; they commenced the respective construction works and, upon completing the respective stages of construction as indicated in the judgment, acquired the remuneration claims against the non-party company as indicated in the judgment; the Plaintiffs carried out the construction works they had each been subcontracted, without being subject to individual direction and supervision by the non-party company, by directing and supervising workers whom they themselves had hired (the record shows that they each hired approximately 16 to 26 workers); and around that time, separately, they also entered into subcontract agreements with non-party Geumgu Geoncheol Co., Ltd., a company in the same corporate group as the non-party company, and carried out construction works thereunder. Upon examining the relevant evidence in the record, the above fact-finding by the court below is deemed justified and acceptable, and there is no violation of the rules of evidence or error in fact-finding affecting the judgment, as argued in the grounds of appeal.
Given the above facts, in light of the contents and nature of the contractual relationship between the Plaintiffs and the Defendant, the relationship of direction and supervision and the manner of business handling in the course of performing the work, the substitutability of the work, and matters relating to remuneration, it is proper to view the Plaintiffs not as workers under the Labor Standards Act who provided labor to the non-party company in a subordinate relationship for the purpose of wages, but rather as independent business operators who had each completed business registration. Even if, as argued in the grounds of appeal, the Plaintiffs received equipment or materials necessary for the work from the non-party company, made daily work reports to the non-party company, and the non-party company enrolled them in industrial accident compensation insurance, such circumstances cannot be taken as grounds to conclude that the Plaintiffs constitute workers under the Labor Standards Act. Furthermore, the remuneration that the Plaintiffs received or were to receive was solely remuneration under the construction subcontract agreements, and not wages paid as consideration for labor itself (the record shows that the Plaintiffs received their remuneration in the form of promissory notes, and that no amount equivalent to Class A wage income tax was withheld therefrom). Accordingly, the judgment below, which reached the same conclusion, is also justified, and there is no error of misapprehension of the legal principles concerning the scope of wages or workers under the Labor Standards Act, as argued in the grounds of appeal.
All the arguments are without merit.
Therefore, all appeals are dismissed, and the costs of appeal are to be borne by the losing parties. This judgment is rendered as stated in the Order by the unanimous opinion of the participating Justices.
Presiding Justice Lee Yong-hun
Justice Park Man-ho
Justice Park Jun-seo
Justice Kim Hyung-sun