The contract said “freelancer.”
They worked for 11 years, then one day received notice that “the contract had expired.”
The Supreme Court viewed this not as an expiration, but as a dismissal.
3-line summary
1. A freelancer who is also a worker may have been unfairly dismissed.
2. A freelance PD who worked for 11 years was found to be a worker.
3. An application for relief must be filed within 3 months of the dismissal.
What determines whether someone is a worker?
The distinction is not based on the name written in the contract. What courts examine is how the person actually worked. The standards long used by the Supreme Court can be outlined as follows.
| What is examined | Points toward worker status | Points toward freelancer status |
|---|---|---|
| How work is assigned | The company gives instructions and supervision | I work independently |
| Time and place | As determined by the company | Determined by me |
| Equipment | Uses the company’s equipment | Uses my own equipment |
| Payment received | Compensation for work performed | Compensation for the deliverable |
| Place of work | Only that company | Multiple places |
In one sentence: Were you running your own business, or tied to someone else’s business?
This is not a scorecard. It is not a matter of being a worker if a certain number of factors apply; all circumstances are considered together. If the contract title decided the issue, companies could evade the Labor Standards Act simply by changing the label.
The three articles are about one case
After the August 4 ruling became known, headlines circulated in several forms. It may appear that “a freelancer who worked for 11 years” and “a worker converted to an indefinite-term contract” are separate people, but they are one case.
It concerns a PD who produced programs at a regional broadcasting company. Beginning in 2011, the PD handled directing, filming, and editing, repeatedly renewed a “freelance work contract,” and received notice in January 2022 that “the contract will expire as of February 28.”
Both the first- and second-instance courts recognized the PD as a worker. They found that the PD worked exclusively under direction and supervision and used company equipment.
They also found that by no later than around 2014, the employment contract had already become an indefinite-term contract. This is because the Fixed-Term Act states that a person employed on a fixed-term basis for more than 2 years is regarded as a worker without a fixed term. Renewing the contract several times does not change that calculation.
Therefore, the “contract expiration notice” was not an expiration but a dismissal. Because the reason was not provided in writing, it was an invalid dismissal that violated procedural requirements.
The issue turned on 6,775만 won
Even before the Supreme Court, the invalidity of the dismissal remained intact. What was overturned was the amount of money.
The second-instance court set unpaid wages at approximately 6,775만 won. Its reasoning was that, while the PD was a worker, there was no basis to classify the PD as “general staff” or “operations staff” under the personnel rules.
The Supreme Court overturned this part. It held that for a worker deemed to have converted to an indefinite-term contract, the employment rules applicable to workers doing similar work at the same workplace may apply equally.
This is the part I find most noteworthy. It means that one should not stop at recognizing someone as a worker; once recognized, their treatment must also be calculated under that standard.
The case was remanded to the Seoul High Court, and the final amount has not yet been determined.
What changes when you are recognized as a worker
Dismissal becomes more difficult. You cannot be dismissed without a justifiable reason, and the reason and timing must be provided in writing.
You become entitled to severance pay. You qualify if you worked for at least 1 year and averaged at least 15 hours per week over 4 weeks.
You become entitled to annual leave and premium pay. You also become eligible for enrollment in the four major social insurance programs.
But there is the issue of 5 employees
Even if you are recognized as a worker, there are benefits you cannot receive depending on the size of the company. Only parts of the Labor Standards Act apply to workplaces with fewer than 5 regular employees, and the excluded items include some significant ones.
| If there are fewer than 5 regular employees | |
|---|---|
| Application for unfair dismissal relief | Not available |
| Paid annual leave | Not available |
| Premium pay for overtime, night work, and holiday work | Not available |
| Severance pay | Available |
| Claim for unpaid wages | Available |
Severance pay is available regardless of the workplace’s size. By contrast, even if you are a worker, the route to the Labor Relations Commission is blocked from the outset if there are fewer than 5 employees.
3 months and 3 years
3 months. This is the period in which you may apply to the Labor Relations Commission for relief from unfair dismissal. It is counted from the day of dismissal, and once it passes, there is no way to reverse it.
3 years. This is the period in which you may claim unpaid wages and severance pay.
“Let’s wait and see for now” is the most dangerous approach.
Where to ask
The Ministry of Employment and Labor Customer Counseling Center (1350, without an area code) provides free consultations on unpaid wages and dismissal issues. Applications for relief are filed with the competent Regional Labor Relations Commission.
What you should gather is records showing how you worked. Messenger conversations containing work instructions, attendance records, salary deposit records, and copies of contracts. Many materials become inaccessible after you leave, so download them in advance.
The contract title is a starting point, not the conclusion. However, this ruling does not make everyone with a freelance contract a worker. The conclusion depends on how the person actually worked.
There is one thing to check now: Which side of that table was my working arrangement closer to?
References
- Segye Ilbo Supreme Court: “A freelancer unfairly dismissed after working for 11 years must receive the same pay as regular employees”
- News1 Supreme Court: “Workers converted to indefinite-term contracts must receive the same treatment as regular employees”
- YTN Supreme Court: “A freelancer who worked for 11 years should be subject to regular employee employment rules”
- Ministry of Employment and Labor Criteria for determining worker status
- Easy-to-Find Practical Law Application for relief from unfair dismissal
The criteria for determining worker status and the relief procedures were referenced from guidance provided by the Ministry of Employment and Labor and Easy-to-Find Practical Law.
This article is for informational purposes, summarizing the ruling and related systems, and is not legal advice. Worker status depends on individual circumstances, so please confirm your own case by consulting a certified labor attorney or lawyer.