There Were No Penalty Points for Lateness. But Arriving Late Meant Fewer Customers to Call

The Time at Which Customer Lists Arrived Determined the Hours of Work

The clock appearing in the judgment runs from 9:30 a.m. to 6:30 p.m. During these hours, the bank's managers distributed among the salespeople the database of customers to be called, at intervals of 30 minutes to 1 hour. The salespeople's computer logs were likewise concentrated in these hours. Even absent a rule imposing a disciplinary letter on a person who did not come to work, the structure was such that failing to be present at that place reduced the number of customers one would receive.

The salesperson telephoned the assigned customers to promote card loans and encourage applications. With effective persuasion, one could produce greater results even from the same list. However, one could not increase the volume of customers one would deal with oneself so as to enlarge the scale of one's income. The Supreme Court saw this difference. The fact that an individual's sales ability affects income and the fact that the bank allocates the opportunities to earn income could coexist.

Reading the customer allocation here as a device of commuting control differs from a psychological inference that the bank deliberately tormented a particular person. What the judgment addressed is the way in which the time of allocation, performance-based compensation, and the reduction of opportunities in one's absence were connected. The personal circumstances of each salesperson or actual amounts of loss do not appear in the disclosed reasons.

Sources for this section: Supreme Court Judgment 2016Da29890 Decided October 27, 2016 — Severance Pay

What Was Overturned in the Retirement Pay Claim

The plaintiffs were telephone solicitation salespersons who had entered into a sales solicitation engagement contract with the bank. The issue of the case was less whether the word 'engagement' entered into the name of the contract than whether they were employees who, under the bank's direction and supervision, worked for the purpose of wages. The plaintiffs claimed retirement pay on the ground that they were such employees.

In its judgment 2016Na1894, pronounced on June 8, 2016, Seoul High Court denied employee status and dismissed the claim. By its decision 2016Da29890 decided on October 27 of the same year, the Supreme Court reversed the court below and remanded the case to Seoul High Court. It reasoned that there was sufficient room to find that labor had been provided in a relationship of subordination, and that there was an error in the application of legal principles denying this.

The confirmed final procedure is this reversal and remand. As this article has not obtained the judgment after remand or the actual payment result, it does not state that all plaintiffs received a specific amount. The reasoning of the court below is likewise reconstructed only to the extent introduced in the Supreme Court's reasons. The explanation that became the target of criticism in the Supreme Court decision and the entire record actually examined by the court below are not of the same scope.

Sources for this section: Supreme Court Judgment 2016Da29890 Decided October 27, 2016 — Severance Pay

Both Guidance to Prevent Mis-Selling and Directives Setting How to Sell

The first fork in the road was the Business Operation Rules and the consultation scripts. While the court below acknowledged the fact that the bank distributed such materials, it read them as guidance materials to prevent violations of laws and regulations in accordance with the exemplary standards of the Financial Supervisory Service, among others. Work recommending financial products requires procedures and standards of explanation for consumer protection. The awareness that one cannot call every engagement relationship employment merely because materials exist is itself worth examining.

The Supreme Court did not fix the purpose of the materials as a single thing. The rules introduced in the disclosed reasons included contents such as not hanging up the telephone first, not interfering with others' work during working hours, and prohibitions on manipulating consultation results. The scripts contained, in addition to closing remarks, words responding to customer refusals and specific lines drawing customers by type toward product use. The Supreme Court viewed these materials as having two characters together: guidelines for compliance with legal norms and guidelines for performing work for the bank.

The boundary is not determined by a single criterion of whether a script was used. Contents requiring that prohibited explanations be avoided and contents prescribing in what order and with what expressions to sell can be read separately. And what happens when those phrases are not followed was also important. The engagement contract stipulated the disadvantage of contract termination, which the Supreme Court evaluated as corresponding to dismissal for cause, for violation of the Business Operation Rules. The contents of the document and the means to enforce it were connected.

However, the disclosed judgment does not carry every sentence of the rules and scripts. One cannot treat the quoted examples as the entire document, nor say that legally mandated compliance requirements and the bank's additional instructions were divided by a certain percentage. The conclusion of this analysis lies in the insufficiency of a single reading of the kind that says the directive character disappears where there is a guidance purpose.

Sources for this section: Supreme Court Judgment 2016Da29890 Decided October 27, 2016 — Severance Pay

Is a Small Number of Sanctions Evidence of the Absence of Supervision?

Call volume and call duration were automatically recorded in the computer program. When a complaint was raised, the bank checked the recording and notified of violations, and compensation was deducted according to the number of notifications. The court below evaluated, citing that continuous monitoring did not take place and that the number of violations or the amount of deductions was small relative to the number of calls, that it was difficult to regard this as management and supervision.

The Supreme Court's counterargument was that supervision does not require that every call be examined. Where it is difficult to check many calls one by one, a method of examining recordings when an issue is raised may be used. That is, one cannot read the mere result of few detections and deductions as meaning that there was no supervision or sanctions. Nor does this mean that every rare sanction proves strong subordination. It is the point that frequency of detection and the structure of supervision convey different information.

The bank did not classify only complaints. It organized work defects such as manipulation of results, insufficient or incorrect explanations, and application form errors into a typology table by grade. Depending on the number of notification letters issued, it provided and applied means such as deduction and non-payment of productivity incentives, deduction of the commission for the relevant performance, and contract termination. It checked recordings where necessary. The Supreme Court noted that there together existed technology capable of management, standards classifying violations, and measures affecting compensation and the contract.

Still, one cannot reconstruct from the judgment the total number of calls, the random sampling rate, or the amounts of sanctions per individual. To compare the intensity of supervision numerically in a state where such figures have not been presented would add new facts. What can be said with certainty is that the Supreme Court did not accept the low deduction ratio recognized by the court below as a sufficient reason for the absence of supervision.

Sources for this section: Supreme Court Judgment 2016Da29890 Decided October 27, 2016 — Severance Pay

When the Method of Allocation Operates More Strongly Than Commuting Orders

The plaintiffs worked in an office prepared by the bank together with three full-time employees, and seats were assigned. Changing seats required the manager's permission. The full-time managers were present at the same time and place, and could know whether the salespeople came to work and whether and how many calls they made. The bank also ran promotions giving additional customer lists according to target call numbers or performance.

The court below held that there was no duty to commute at a specific time, citing the absence of disadvantages such as discipline for tardiness or absence. The Supreme Court judged that, even without express disciplinary provisions, tardiness, early departure, leaving, and absence, due to repeated allocation at set time slots, led to receiving fewer customer lists, and that this became a disadvantage affecting performance. The materials from which restraint of working hours is to be found are not confined to attendance records and disciplinary tables.

Of course, the mere fact that a salesperson who works less earns less is not unfamiliar. The circumstances that carried this case beyond that general proposition were that the salesperson had difficulty supplementing opportunities by widening the salesperson's own customer base, and that the bank distributed customers at each set time. The intervals of allocation, the operation of the office, and the manager's performance management overlapped. In this analysis, that combination is read as control over income opportunities.

From the disclosed reasons alone, one cannot know whether a make-up allocation was made the following day for those absent, or by what standards the quality of the customer lists differed. Although the Supreme Court explained that the quantity and quality of what was allocated were important to the plaintiffs' income, it did not say that discriminatory quality adjustment was recognized as fact. Care must be taken that the reading of opportunity control does not turn into an assertion of a specific unfair allocation.

Sources for this section: Supreme Court Judgment 2016Da29890 Decided October 27, 2016 — Severance Pay

Between the Fact of Receiving Performance Pay and the Fact of Operating an Independent Business

The ability to persuade customers can create differences in performance. But the comprehensive assessment set out by the Supreme Court also includes whether one can operate a business on one's own calculation and whether one bears the risk of profit and loss oneself. One sentence that compensation varies according to performance cannot answer these questions as well.

In this case the bank provided necessary items such as the office, computers, and telephones. The plaintiffs conducted in-office consultations according to the provided customer data and work guidelines. The Supreme Court also evaluated that, in light of the nature of that work, there was little room for considerable additional costs to arise beyond this, and that the work could hardly be regarded as requiring expertise. This is not a general occupational evaluation that all telephone consultation work lacks expertise, but a judgment directed at the work described in this case.

The plaintiffs were also prohibited from having the work performed by others. Following the bank's instructions, they sometimes performed work other than the promotion of products set in the contract, such as changing customer information, guidance on cashback, and conversion of a lump-sum payment into installments. A Saturday work fee had at one time been separately provided among the commission payment items, and monies such as productivity allowances were also paid. The Supreme Court examined these operating circumstances together. The fact alone that one worked on Saturdays did not fix standard working hours or the amount of a specific allowance.

Not only who evaluates the results of the work, but also who decides on customers, facilities, substitute personnel, and additional work, is connected. Even where variability attributable to the salesperson's own effort remains, the other party may set the core conditions of operation. Conversely, not every transaction in which equipment is provided becomes dependent labor. The provision of equipment in this case gains meaning when read together with other facts of control.

Sources for this section: Supreme Court Judgment 2016Da29890 Decided October 27, 2016 — Severance Pay

Two Ways of Reading the Same Facts

If the court below's reading is reduced to a judgment deceived by the name of the contract, the difficulty of this case disappears. According to the Supreme Court's reasons, the court below also recognized the distribution of guidelines, call records, deductions, and the office and customer allocation. The difference lay not only in the existence of facts but in the assessment of whether those facts meant subordination.

The explanation in the direction of independent sales binds together compliance guidelines of a regulated industry, rare post-hoc sanctions, and the absence of express commuting discipline. The Supreme Court's reading binds together the specific sales methods among the guidelines, the connection between the checking of recordings and deductions from compensation, and the substantive disadvantages arising from customer allocation by time slot. The former may be summarized as asking whether each device can be explained as ordinary transaction management, and the latter as asking how much choice remained to the plaintiffs when those devices operated together. This distinction between the two sentences is an editorial interpretation reading the judgment.

Whichever explanation is adopted, it is easy to misread if a single marker is made decisive. One cannot reach a conclusion from the contract termination clause alone, from commission compensation alone, or from the absence of commuting penalty points alone. The conditions enumerated by the Supreme Court are not a simple counting table. In this case, what mattered was whether several conditions meshed in the same direction.

Sources for this section: Supreme Court Judgment 2016Da29890 Decided October 27, 2016 — Severance Pay

Comparative Case: Did the Work Also Change After the Form Was Changed?

The 2016 judgment referenced the Supreme Court decision 2012Da20550 decided July 9, 2015, as grounds for the general criteria of determination. That case was not a bank telephone counselor case, but a retirement pay case of persons handling debt collection work. The customer data, contract changes, and management practices of the two cases must not be mixed with one another.

In the 2015 case, the company deleted some provisions, such as designation of time and place, performance management, and prohibition of third-party delegation of work, while changing the contract form. The court below denied employee status after the changed contract was concluded. However, the Supreme Court examined the circumstances that the team system and computer-based management, and performance-based rewards and punishments at some branches, continued. It found that the company sometimes used the old form again, and that materials showing that the method of performing the work and the direction and supervision had changed to the extent of altering the view of employee status were insufficient. It reversed and remanded the portion of the judgment in which the plaintiffs lost.

The question this comparison adds is not whether there is a document, but whether operation changed. The absence of commuting discipline in the 2016 case likewise required separate confirmation of whether actual restraint of time existed. However, the circumstances of the change of contract form or the contents of company meetings confirmed in the 2015 case cannot be transferred as the hidden motive of the bank case. That similar legal principles were referenced does not make the parties' intentions the same as well.

The two judgments explain that conditions such as base pay, withholding of wage income tax, and treatment under the social security system are largely subject to the employer's decisions, and that one should not lightly deny employee status merely because such markers are absent. Based on this general legal principle, one does not write that the exact tax treatment or insurance enrollment status of the plaintiffs in the bank case was confirmed. Those facts are not specifically presented in the disclosed reasons read.

Sources for this section: Supreme Court Judgment 2016Da29890 Decided October 27, 2016 — Severance Pay · Supreme Court Judgment 2012Da20550 Decided July 9, 2015 — Severance Pay for Debt Collectors

If the Records Had Been Different, Which Connection Would Be Shaken?

What follows is not an introduction of actually submitted evidence, but a hypothesis testing the structure of judgment. First, assume records that the salesperson sold products of several companies to the salesperson's own customers, secured customers directly, and could refuse allocation at any time or replace it with independent sales. If there are even records of entrusting the actual work to substitute personnel hired at one's own expense, the counter-reading of independent operation with respect to customers and personnel becomes stronger. Execution records explain more than the mere fact that 'autonomy' is written in the contract.

Second, assume operating records that, although the bank's times of allocation were fixed, customer opportunities during absence were preserved as they were, upon reconnection they were received on the same conditions, and one was not disadvantaged in targets or subsequent allocations due to absence. Then the connection that tardiness and absence lead to reduced opportunities must be examined again. Still, if other circumstances such as work guidelines, sanctions, and the prohibition on delegation remain unchanged, employee status as a whole is not automatically denied. One must distinguish that a single connection becomes weaker from that the final conclusion changes.

A hypothesis in the opposite direction is also possible. If the manager had the expressions and order of individual consultations revised from time to time, and if the dates on which customer allocation was reduced for failure to follow instructions and the reasons therefor remain as actual records, control over work methods and control over income opportunities become connected more directly. This is not a claim that such additional records existed in the actual bank case. It is an example to show what, if newly learned, would strengthen the explanation concerning subordination.

No hypothesis guarantees victory or defeat with a single material. One must again ask whether operating logs of some periods represent the entire contract period, whether authority stated in documents was actually exercised, and whether other salespeople's materials can be applied to the plaintiffs. Even if the disclosed judgment showed a particular connection, one cannot fill the blanks of later cases with the same facts.

Sources for this section: Supreme Court Judgment 2016Da29890 Decided October 27, 2016 — Severance Pay

Not Speaking as Though One Had Seen the Original Records

What we have read are the facts that the court extracted from the record and presented as the reasons for judgment. We have not directly analyzed the entire computer logs, the customer allocation tables by individual, the originals of the notification letters, and all commission statements. Hence we did not describe how much was deducted from which salesperson on which day, what happened in the gaps where records are missing, or with what state of mind the manager gave instructions.

Whether the plaintiffs worked in the same form for several years, and the calculation period and amount of each one's retirement pay, are also not completed from these disclosed reasons alone. Although the plaintiff is indicated as a selected party, the list of selecting persons is omitted. Instead of filling in the plaintiffs' personal circumstances, following the work structure connected by the disclosed reasons is the depth of analysis possible in this material.

The same limitation applies when evaluating the bank's explanation. The facts recognized by the court below and the reasons for which the Supreme Court reread them can be compared, but one cannot say that one has read the full text of the court below's record, which was not obtained, or reproduced all of the bank's assertions. Gaps in the explanation do not prove the dishonesty or hidden intent of the losing party.

Sources for this section: Supreme Court Judgment 2016Da29890 Decided October 27, 2016 — Severance Pay

Do not extend the 2016 conclusion to every commission contract of today

For this material, the text of Article 2 of the Labor Standards Act on the National Law Information Center could not be opened, so the current wording of subparagraph 1 of Article 2 (1) and its date of entry into force could not be confirmed. The 2016 judgment's assessment of the facts should not be read on the premise of a current definition that has not been confirmed. Without confirmation of the current definition provision, the assessment of the facts in this case cannot be applied as it stands to all other industries and contracts.

This piece concerns worker status under the Labor Standards Act. It is not a practical guide that has examined the persons protected under other statutes, today's scope of insurance coverage, extinctive prescription, or the individual requirements and calculation methods for retirement benefits. Nor is it material that has traced all later case law to verify that the 2016 explanation remains unchanged in every respect.

The concrete question this case leaves is both narrower and deeper than whether there was a table of penalty points for attendance. What did a person actually lose by being away at the set hours, and could that opportunity have been secured in some other way? The Supreme Court read that question together with the allocation of customer data, the consultation guidelines and the means of sanction, and held that the lower court's denial of worker status could not stand. That is the extent of the judgment as checked.

Sources for this section: Supreme Court Judgment 2016Da29890 Decided October 27, 2016 — Severance Pay · National Law Information Center — Article 2 of the Labor Standards Act, version in force from August 20, 2026