By Lee Kyung-min
A district court ruled Monday that an English language institute, the location of which is being withheld, should pay a total of 186 million won ($166,200) to five former employees as severance pay.
The Seoul Central District Court recognized the relationship between the institute and the five English instructors -- three Americans, one Canadian and one Korean whose identities were all withheld -- as that of employer and employees, a claim the institute denied.
Of the five, the employee who worked there the longest -- eight years and three months -- will receive 66.9 million won while the employee who worked there for the shortest period -- 15 months and 26 days -- will get 20 million won. They were under contract to teach middle and high school students English between three to six hours a day, four to five days a week. Their hourly wage varied from 30,000 won to 42,000 won.
The package includes a lump sum amount, which the company, upon termination of employment, needs to pay for people who worked a full year. The worker gets their monthly wage multiplied by the years of employment.
It also includes unpaid vacation including 15-days and 1-day of severance pay for each year and each week of employment, respectively.
The five filed the suit in September 2015 after their contracts expired, claiming they were eligible for the severance package guaranteed by the Labor Standards Act.
The institute claimed it and the instructors each signed contracts as two independent business owners, and stipulated that the money was in return for their respective services, denying it was an employment contract.
However, the court dismissed the claim saying the instructors were not guaranteed any autonomy, which proved the latter acted as an employer.
The court said the workers are recognized as employees because they had no discretion in deciding the nature, time and place of work, or setting rules on using materials needed for the work.
They were not responsible, the court continued, for either the profit or deficit of the business and were subject to constant, strict monitoring -- including being watched with surveillance cameras -- as well as punishment following violations of the institute’s guidelines.
The institute claimed the instructors largely agreed to its terms by signing the contracts which stipulated they will not be eligible for a severance package as such payment was already included in their hourly wage. The court, however, said the contract failed to clearly specify such terms in detail.
The court also dismissed the institute’s claim that granting the instructors’ severance packages would not only severely distort the original contract, but result in undue excessive benefit to the latter.
It ruled such a claim was not only against the related law but also violated the Constitution, which guarantees the rights of workers.