The standing special counsel team led by Ahn Gwon-seop, which has been investigating allegations of unpaid severance pay at Coupang, has indicted the former and current CEOs of Coupang's logistics subsidiary, Coupang Fulfillment Services (CFS), and the corporation itself on charges of violating the Employee Retirement Benefit Security Act.
On the 5th, the special counsel held a briefing on the investigation results and said it indicted without detention current CEO Jeong Jong-cheol, former CEO Eom Seong-hwan, and the CFS corporation on charges of violating the Employee Retirement Benefit Security Act (Severance Pay Act). Jeong and Eom are accused of failing to pay 124.94 million won in severance to a total of 40 day laborers who worked at logistics centers operated by CFS and left between Nov. 2022 and Apr. 7, 2024, within 14 days of their separation date. The same charge was applied to CFS.
The special counsel's investigation found that CFS internally prepared and implemented a plan to improve the day labor system on Apr. 1 last year. This occurred before employment rules for day laborers were changed on May 26 the same year. The special counsel said, "Regardless of the employment rule changes, we confirmed that CFS denied the continuity of employment for day laborers and unilaterally excluded them from those legally entitled to severance."
According to the special counsel, CFS changed its rules on severance payments from "day laborers who work for at least one year are excluded only for periods with fewer than 15 hours per week" to "workers who have at least one year of service and work at least 15 hours per week." The crux was that if even a single day during the employment period included a week with 15 hours or less, the severance calculation period would be reset from that point.
The special counsel also took issue with the fact that, even though CFS prepared a plan to improve the day labor system that could significantly affect the treatment of day laborers, it did not seek any authoritative interpretation from the Ministry of Employment and Labor (MOEL) or external legal advice. During this process, it did not separately hear the opinions of day laborers, and it did not even notify them of the implementation itself.
The special counsel explained, "We also confirmed that CFS estimated an annual expense reduction effect of about 4.4 billion won from implementing this improvement plan."
Meanwhile, in connection with this case, the special counsel said on the 27th of last month it indicted without detention former Bucheon District Office Chief at the Incheon District Prosecutors' Office Um Hee-jun (now a prosecutor at the Gwangju High Prosecutors' Office) and former Deputy Chief Prosecutor at the Bucheon District Office Kim Dong-hee (now a prosecutor at the Busan High Prosecutors' Office) on charges including abuse of power and obstruction of another's rights over alleged external pressure on the investigation. Um was also charged with giving false testimony when appearing as a witness at a National Assembly audit in Oct. last year.
According to the special counsel, the two prosecutors are accused of instructing subordinates in Apr. last year, while serving at the Bucheon District Office, to so-called "pass" their immediate superior, the Director General, when disposing of the Coupang unpaid severance case as non-indictment and reporting it to the Supreme Prosecutors' Office.
The special counsel said it could not confirm any collusive ties between the defendants and Coupang officials because, due to the noncooperation of key reference witnesses, it did not complete forensic procedures on some seized mobile phones.