An IT company dismissed an employee four months after hiring, citing the end of a project, but a court ruled it was an unfair dismissal. The court overturned a Central Labor Relations Commission (CLRC) decision that had dismissed the case on the grounds it could not be viewed as a dismissal.
The Administrative Division 12 of the Seoul Administrative Court (Chief Judge Kang Jae-won) on the 24th ruled in favor of A in a lawsuit filed on Sept. 25 seeking to annul a CLRC reexamination decision on relief for unfair dismissal.
According to the judgment, A joined Company B on Nov. 13, 2023, and took part in a specific project. However, A filed for relief with the labor commission, saying A was effectively notified of termination on March 18 last year, four months after joining.
A said A signed a full-time employment contract with Company B and was waiting to be assigned to other work after the project ended, but the company abruptly terminated the employment relationship. A argued that it constituted unfair dismissal because there was no just cause and no written notice.
By contrast, Company B claimed that A expressed an intention to resign voluntarily during a phone call on Feb. 6 last year. It added that it had merely reviewed placement on another project on humanitarian grounds. The Seoul Regional Labor Relations Commission and the CLRC accepted the company's claim and viewed the employment relationship as having naturally ended with the project's conclusion.
The court, however, reached a different conclusion. The panel found the company's claim that A expressed an intention to resign voluntarily lacked credibility. It noted that Company B had suspended A effective Feb. 14 last year. The panel said, "Given Company B's adamant stance that there were no projects for the time being and there was no option other than suspension, it appears A reluctantly acquiesced."
Company B argued that, based on industry practice, an implied term in the contract provided that the employment relationship would end upon project completion, but the panel did not accept this. The contract the parties signed was a full-time employment contract with no fixed term, not a freelancer contract, and practice cannot substitute for dismissal procedures.
The panel ultimately ruled that Company B's action amounted to an unfair dismissal and that the CLRC's decision finding otherwise was unlawful.