The Supreme Court ruled that POSCO must directly employ workers affiliated with in-house subcontractors because they are in an illegal dispatch status. This ruling also includes workers affiliated with POSCO's second-tier partner companies.
The Supreme Court's Second Division (Presiding Justices Park Young-jae and Eom Sang-pil) on the 16th finalized lower court rulings that partially sided with 378 workers who were employed by POSCO's in-house partner companies and worked at the Pohang Works and Gwangyang Works in two lawsuits seeking confirmation of their employee status.
The Supreme Court upheld the lower court's ruling against four POSCO M-Tech employees who handled cold-rolled product packaging, saying they "did not receive substantial direction or orders from POSCO." For five people who had passed the mandatory retirement age, the court dismissed the suits, saying there was no benefit to bringing them.
Earlier, 568 workers including a person surnamed Kim from POSCO partner companies filed suits in 2018 and 2021 against POSCO seeking recognition as employees. Some withdrew their suits during the proceedings.
The 378 people whose cases went to the final appeal are affiliated with partner companies including Dongil, Hwaintec, Roll & Roll, Seonggwang, and Poace. They worked in tasks such as crane operation, plant work, raw material unloading, rolling processes, roll machining, steelmaking processes, and coke oven maintenance and repair.
Under the Dispatch Act, even if affiliated with a partner company, if work is performed under the user company's direction and orders and the period exceeds two years, the user must directly employ the worker. The issue in the suits was whether a dispatch relationship was established between POSCO and the workers affiliated with subcontractors.
The first trial found that a dispatch relationship was established between POSCO and the partner company employees. It cited as grounds that POSCO set key performance indicators (KPI) and evaluated a wide range of matters including the partner companies' personnel, labor, and overall management. In addition, work standard manuals created by POSCO specifically set out the sequence of tasks and detailed work methods that partner company employees had to perform.
The appellate court ruled in the same vein for most plaintiffs. However, it did not recognize a dispatch relationship for four POSCO M-Tech employees who handled packaging work, citing POSCO M-Tech's independent experience and technology.
The Supreme Court maintained the lower court's findings. Among the prevailing plaintiffs are workers affiliated with POSCO's second-tier partner companies who perform equipment maintenance and repair work at coke ovens.
Under this ruling, among the prevailing workers, those who worked more than two years before the 2006 revision of the Dispatch Act are recognized as POSCO employees. POSCO must directly employ them. For those who worked more than two years after the revision of the Dispatch Act, POSCO bears a direct employment obligation.
Workers at POSCO's partner companies have pursued illegal dispatch lawsuits since 2011. The first and second rounds of suits, filed by 59 workers in 2011 and 2016, respectively, were finalized in July 2022 at the Supreme Court with rulings for the plaintiffs. The third and fourth rounds were filed in 2017, and in April this year the Supreme Court finalized rulings for 215 plaintiffs. As for seven POSCO M-Tech employees, the court reversed and remanded with instructions unfavorable to the plaintiffs.
The suits that received final Supreme Court rulings this time are the fifth and seventh-1 rounds. The sixth and seventh-2 rounds were finalized at the Supreme Court with dismissals without deliberation, resulting in wins for the plaintiffs. The eighth to tenth rounds, with 1,177 participants, are undergoing first trial proceedings.