① Party Represented by Barun Law (attorneys in charge: Moon Ki-Joo, Lee Kyung-Jin, Lee Jong-Hwa): We represented a regional government of education (the "defendant")

② Background of the Case: A regional employment and labor office (the "Labor Office") determined that "although the outsourced after-school care teachers' work is in the form of an outsourcing contract, in essence, it qualifies as a dispatched worker relationship. Therefore, it is illegal for the outsourcing companies to provide the services of dispatched workers without obtaining a dispatch permit." Based on this, the Labor Office instructed the defendant to directly employ the outsourced after-school care teachers. Consequently, the defendant signed an employment contract with these outsourced care teachers, hiring them as permanent contract care teachers with a working time of 5 hours per day.

③ Details of Litigation: The outsourced care teachers filed a lawsuit against the defendant, claiming that the defendant "should compensate them for the period during which it failed to fulfill its obligation to directly employ them, and even upon fulfilling this obligation, it should bear the obligation to compensate for any parts that fall short of the standards set by Article 6(3) of the Dispatch Act." They argued that the defendant's decision to set their working hours to 5 hours a day when signing the employment contract contradicted the employment rules and relevant laws applicable to regular contract care teachers, and therefore, they should be paid wages based on an 8-hour workday. The lower court found that there was the employment dispatch relationship between the outsourced care teachers and the defendant and ruled in favor of most of their claims, stating that the compensation should be calculated based on an 8-hour working day in accordance with Article 6(2) of the Dispatch Act.

The Supreme Court's 1st Division on September 12, 2024, upheld the lower court's recognition of an employment dispatch relationship between the outsourced care teachers and the defendant, but stated that: (1) instead of assuming that the outsourced care teachers are naturally entitled to an 8-hour workday, 40-hour workweek, it should be considered that if they were directly employed, the contract could have been established as part-time educational public employees; (2) given the government's policy to expand after-school care services, it may not be necessary to fix the working hours of after-school care teachers to an 8-hour day, 40-hour week; (3) as of April 30, 2018, approximately 82% of permanent contract after-school care teachers nationwide worked less than 40 hours per week, six provinces or cities operated after-school care classes without any teachers working 40 hours per week, the actual working hours for the outsourced care teachers relevant to this case were 5 hours per day during school terms and 8 hours during vacations and when the defendant directly hired them on October 1, 2018, the daily working hours were set to 5 hours; and (4) the working hours of after-school care teachers need to be flexibly determined based on the operational format and demand of after-school care programs, and therefore, it may be possible for the defendant to exercise discretion in hiring care teachers with different working hours. Taking these factors into consideration, the Supreme Court found fault in the lower court's misinterpretation of legal principles regarding the calculation of compensation and remanded the case for further examination on the aspects where the defendant had lost.

Leveraging its extensive experience in handling multiple lawsuits concerning the recognition of compensation liability under employment dispatch relationships, we actively argued for the defendant at the appellate stage.

Specifically, (1) even if unlimited contract after-school care teachers and outsourced care teachers perform similar duties, it is not mandatory for their employment conditions to be uniform; (2) the working arrangement of outsourced care teachers was not intended to undermine the purpose of the Dispatch Act but was based on the need for flexible workforce allocation considering the circumstances of each local government; (3) even among unlimited contract after-school care teachers, there exist 5-hour daily work patterns; (4) the working hours for after-school care teachers vary significantly by local government; (5) differences exist in job scope, authority, and responsibilities between outsourced care teachers and unlimited contract care teachers; and (6) the direct employment contracts with outsourced care teachers were made through mutual agreement. We emphasized that the lower court had misinterpreted legal principles regarding the calculation of compensation under employment dispatch relationships.

Today, the forms of labor provision are becoming increasingly complex and diverse. Despite entering into contracts such as service contracts or delegation contracts, there are numerous cases where these relationships are recognized as employee dispatch relationships. Especially, even in a situation where the existence of a dispatch employment relationship is found, disputes often arise between parties over setting new employment conditions when fulfilling the direct employment obligation. This ruling not only provides guidelines on factors to consider when calculating compensation in cases where a dispatch employment relationship is recognized but also serves as an important benchmark in the process of setting new employment conditions.

- Attorneys involved: Moon Ki-Joo, Lee Kyung-Jin, Lee Jong-Hwa