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Recent Supreme Court Ruling on Labor Standards Act and Its Possible Implication on Foreign Companies Operating Subsidiaries in Korea |
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On October 25, 2024, the Supreme Court’s First Division rejected an appeal by a company that filed suit seeking to nullify a Central National Labor Relations Commission (NLRC) decision that deemed the termination of an employee wrongful.
In the underlying case, Company A, a Korean travel agency, terminated one of its three employees. The ex-employee had been responsible for accounting since 2016, and the reason for termination was due to the downturn in the travel industry following the COVID-19 pandemic. At the time, Company A was sharing an office space with Company B. From 2019 onwards, Company A and Company B became subsidiaries of the same foreign company, Company C.
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