Newsletter | December 2016, Issue 4
	LABOR & EMPLOYMENT
	Recent High Court Decision Denies the Status of a Union at a Former Single-Union Company as the Designated Collective Bargaining Channel
	Issue Undertaken in a Recent Case
	In Korea, the lower courts are split on the issue of whether a union at a former single-union company, which went through the process of establishing a single bargaining channel, may enjoy the status as the designated single bargaining channel after a new union has formed.
	For its part, the Ministry of Employment and Labor ("MOEL") has recognized the status of such unions as designated single bargaining channels.
	Recently, the High Court questioned the validity of the process of establishing a single bargaining channel in a formerly one-union company, and denied the representative status of that union.
	Relevant Facts of the Case1
	In 2013, an auto parts manufacturing company (the plaintiff in this case) had a single industrial union ("1st union"), which requested collective bargaining. - Under Article 29-2 of the Trade Union and Labor Relations Adjustment Act ("TURLA"), the company designated the 1st union as the representative bargaining unit, and entered into a collective bargaining agreement ("CBA") in March 2013 for one year ending in March 2014.2 - The company and the 1st union also agreed that the union leader ("Participant") would be entitled to a full time-off schedule, so that he could manage union matters. In December 2013, a new company union was formed ("2nd union"). - The 1st union and the 2nd union both requested collective bargaining in January 2014. - The company designated the 2nd union as the representative bargaining unit in February 2014, because the 2nd union represented the majority of the employees. - On April 3, 2014, the company and the 2nd union entered into a CBA for two years, ending on April 3, 2016. In February 2014, when the Participant’s time-off schedule expired, the company ordered him to return to work, and warned that failure to return to work could lead to a disciplinary action. - Thereafter, the Participant refused to return to work, and resumed his duties despite repeated requests by the company. - The company eventually terminated the Participant in June 2014 on the ground of his unexcused absence. Participant’s Claim The Participant, claiming wrongful dismissal, argued that the 1st union's status as the representative bargaining unit was valid until March 20, 2015 (i.e., two years from the effective date of the CBA, per Article 14-10 of the Presidential Decree), and that the company had no right to refuse to collectively bargain with the 1st union. Therefore, Participant argued that his absence was justified. The High Court's Decision Whether the 1st union should have been deemed as the representative bargaining unit, the High Court held: For the 1st union to be deemed as the representative bargaining unit for a period of two years from the effective date of the CBA (March 21, 2013), under the TURLA, the 1st union would have to have been selected as the representative bargaining unit through the process of establishing a single bargaining channel among multiple unions. The process of establishing a single bargaining channel is relevant only when there are multiple unions in one company, because: (i) the TURLA stipulates that unions must determine the representative bargaining unit to request collective bargaining where there are two or more unions; (ii) the purpose of the single bargaining channel system is to establish an effective and secure bargaining channel, so that the working terms and conditions of the members of multiple unions at a company are harmonized. At the time the 1st union entered into the CBA with the company in March 2013, no other unions existed at the company. Therefore, the process the 1st union went through after the company had announced the bargaining request was not the process for establishing a single bargaining channel in accordance with the TURLA. Supreme Court’s Decision The Supreme Court dismissed the Participant's appeal to the High Court decision, confirming it through summary dismissal3 ). Impact Since the Supreme Court's decision was a summary dismissal, we cannot conclude that the Supreme Court accepted the High Court’s rationale or ruling on this issue. However, when establishing a single bargaining channel, it would be prudent for companies to take heed of the requirements and procedures discussed in the case.   1 Seoul High Court 2015nu54690 2 According to Article 14-10 of the Presidential Decree of the TURLA, the representative status of a single bargaining unit shall last two years from the date the CBA takes effect. 3 Supreme Court Decision 2016du33797. Back to Main Page If you have any questions regarding this article, please contact below: Weon Jung Kim wjkim@kimchang.com Sung Wook Jung sungwook.jung@kimchang.com For more information, please visit our website: www.kimchang.com Labor & Employment Practice