How to Utilize Part-time Workers
Bongsoo Jung, Korean labor attorney at KangNam Labor Law Firm
I. Introduction
In 2014, IKEA, a Swedish furniture company, entered Koread and recruited most of its field workers as part-timers working four hours a day, which shocked our society. This company was able to maintain better productivity than was normal in Korea while using part-time workers. It is very rare for Korean companies to use part-time workers as regular workers, mainly because they are employed as Alba, temporary or part-time low-wage workers in small businesses within the service sector. The proportion of part-time workers in Korea was only 10.8% in 2014, while it was 37.2% in the Netherlands, 27% in Japan, 24.9% in Britain, and 22.1% in Germany in the same period. There are no differences in Korean labor laws compared to foreign labor laws regarding part-time workers: The working hours of part-time workers are shorter than those of regular workers, while their working conditions are similar to that of full-time workers.
In fact, if working conditions for part-time workers are properly maintained, sharing of work with full-time workers is also possible, which is expected to result in greater productivity while creating more employment. In particular, it makes it possible to attract female workers and elderly people whose career quite often has been cut short in the labor market. In regards to the protection of short-term workers, I would like to specifically examine (i) the concept of the part-time worker, (ii) statutory working conditions, and (iii) the prohibition of discriminatory treatment.
II. Concept of the Part-time Worker
The term “part-time worker” in Article 2 of the Labor Standards Act (LSA) means an employee whose contractual working hours per week are shorter than those of a full-time worker engaged in the same kind of job in the same workplace. For example, since a full-time worker works 40 hours per week, a worker who has worked 8 hours for 4 days in a week (32 hours per week) is considered a part-time worker.
The concept of part-time worker includes (i) one-week basis, (ii) contractual working hours, and (iii) the working hours of regular workers.
(i) The one-week basis shall be the working hours of the week if the working hours are constant every week, but the average of 4 weeks shall be calculated for the weekly contractual working hours when weekly working hours are not constant (Article 18 of the LSA).
(ii) The number of contractual working hours per day for part-time workers is the number of hours divided by the number of days for a full-time worker for that period. In other words, the calculation may vary depending on the total number of days worked by a full-time worker over a four-week period. Contractual working hours is defined as the working hours determined between the worker and the employer within the range of legal working hours, so the contractual working hours should be equal to or less than the legal working hours (Article 2 of the LSA).
The calculation method for the contractual working hours per day is as follows: ① 6 hours per day from Monday to Friday and a 5-day working per week: [(30 hours x 4 weeks)/(5 days x 4 weeks) = 6 hours]. Or ②, if a regular worker works 6 days a week: [(30 hours x 4 weeks)/(6 days x 4 weeks) = 5 hours].
(iii) The standard for full-time workers is defined as "full-time workers engaged in the same kind of job in the same workplace" in Article 2 of the "Act on the Protection etc. of the Fixed-Term and Part-Time Workers" (FPA). The court explained that whether or not the work of the employee selected as a comparable worker corresponds to the work of the same or similar type as the work of a part-time worker is not based on the work content as specified in the rules of employment or the employment contract, but on the basis of the work actually performed by full-time workers. However, even if the tasks they perform are not completely in agreement with one another and there are some variances in the scope, responsibilities and authority of the tasks, they are considered to engage in similar tasks unless there is a substantive difference in the content of the main task.”
III. Legal Working Conditions of Part-time Workers
Working conditions for part-time workers shall be determined on the basis of the relative ratio of their working hours in comparison to those of full-time workers engaged in the same kind of job in the same workplace (Article 18 of the LSA).
That is, even part-time workers are subject to all the provisions of the Labor Standards Act, but for statutory holidays and leaves, the principle of proportional working hours of ordinary workers is applied.
1. Employment contracts and Rules of Employment
(i) Employment contract: The employment contract of part-time workers must be issued in writing. In case of violation, a penalty of KRW 5 million is imposed (Articles 17 and 24 of the FPA). The items that must be included in the labor contract include: 1) Matters concerning the contract period; 2) Matters concerning working hours and rest hours; 3) Matters concerning components, calculation and payment methods of wages; 4) Matters concerning holidays and leave; 5) Matters concerning the place of work and required work; 6) Work days and working hours of each work day. The reason for requiring the employer to make labor contracts in writing is to prevent disputes for violation of the Labor Standards Act in advance.
(ii) Rules of Employment (ROE): The employer may create Rules of Employment that apply to part-time workers separately from those that apply to full-time workers. If an employer wants to make or change the rules of employment, the employer shall seek seek consultation of the majority of the part-time workers to whom the ROE will apply. However, if the ROE are to be modified in a manner that is unfavorable to the part-time workers, the employer must obtain the consent of the majority of the part-time workers (Article 94 of the LSA). The purpose for this is to prevent the employer from unilaterally lowering the working conditions of part-time workers.
2. Wages
(i) The wage calculation unit for a part-time worker is based on the hourly wage. If hourly wage is calculated as daily ordinary wage, the number of hours worked per day is multiplied by the hourly wage. (ii) The wage shall be paid in full to the worker directly in Korean currency, and shall be paid at least once per month on a fixed date (Article 43 of the LSA). (iii) For part-time workers, the average wage of 30 days or more for one year of continuous work shall be paid as severance pay. In this case, if the average wage is less than the ordinary wage, the ordinary wage must be paid as severance pay (Article 2 of the LSA). Also, in establishing a severance pay system for part-time workers, there should be no difference from that of the severance pay system for full-time workers. (iv) Even if there is no comparable full-time worker, the minimum wage under the Minimum Wage Act must be paid.
3. Working hours
(i) The contractual working hours of part-time workers are strictly protected. The employer must obtain the consent of the part-time worker in cases of having the part-time worker work beyond the contractual working hours, and in instances such as this the Act (FPA) also stipulates that the part-time worker shall not work more than 12 additional hours from the contractual working time of one week. The employer shall pay part-time workers at least 50/100 of the ordinary wage for overtime work exceeding the contractual working hours within the legal working hours (8 hours per day, 40 hours per week). Under the Labor Standards Act, an additional wage of 50% or more of ordinary wage is paid only for overtime work exceeding legal working hours, but for part-time workers, payment of additional wages is prescribed even if the contractual working hours are exceeded within the legal working hours (Article 6 of the FPA). (ii) Part-time workers are also paid an additional 50% for holiday work as specified in the rules of employment, and 100% for holiday work exceeding 8 hours (Article 56 of the LSA). (iii) If a part-time worker performs night work between 10 pm and 6 am on the following day, the employer shall pay wages with an additional allowance equivalent to 50/100 (Article 56 of the LSA).
4. Holidays and annual paid leave
Holidays and annual paid leave for part-time workers are applied equally in accordance with the principle of proportional working hours for full-time workers.
(i) Holidays: An average of one paid holiday per week worked shall be guaranteed, for which the contractual working hours of one day must be paid. When calculating wages according to hourly wage, the employer shall pay an additional weekly holiday allowance. However, in the case of a part-time worker who has been employed for weekend or holiday work, the weekly holiday should be given as a paid holiday on a non-weekend day.
① Calculating 6 hours per day from Monday to Friday, 5 days’ work per week for full-time workers and payment of KRW 10,000 per hour: [(30 hours x 4 weeks)/(5 days x 4 weeks) = 6 hours], results in [6 hours x KRW 10,000 = KRW 60,000]. ② However, if full-time workers are working for 6 days a week: [(30 hours x 4 weeks)/(6 days x 4 weeks) = 5 hours], the result is [5 hours x KRW 10,000 = KRW 50,000].
(ii) Annual paid leave: The employer shall grant part-time workers a number of days of annual paid leave equal to that of full-time workers. Annual paid leave is calculated in hours, with less than one hour counting as one hour. Also, in case of monthly paid leave for those working less than one year, the contractual working hours of one day per each month should be given as monthly paid leave. The criteria for granting annual paid leave for part-time workers are as follows:
Number of annual leave days
for full-time workers
× Number of hours worked for part-time workers × 8 hours
Number of hours worked for full-time workers
If a part-time worker works 20 hours a week, this works out to [15 days x (20 hours/40 hours) x 8 hours = 60 hours]. In other words, each four hours is guaranteed as an annual paid leave day.
(iii) Maternity Leave: The employer shall give 90 days of pre-and post-natal maternity leave for pregnant part-time female workers, with the first 60 days of maternity leave being paid. ① The maternity leave allowance is the amount calculated as the hourly wage of a part-time worker multiplied by the contractual working hours of one day and multiplied by 60 days. ② The remaining 30 days can be paid as maternity leave benefits as stipulated by the Employment Insurance Act (Article 74 of the LSA). Assuming that a part-time worker is paid KRW 10,000 per hour, and the contractual working hours is 5 hours per day. ① The maternity leave allowance is KRW 10,000 x 5 hours x 60 days = KRW 3,000,000. ② The maternity leave benefit is KRW 10,000 x 5 hours x 30 days = KRW 1,500,000.
IV. Prohibition of Discriminatory Treatment and the Exception of Applications
1. Prohibition of discriminatory treatment
An employer shall not give discriminatory treatment to any part-time employee on the grounds of his/her employment status compared to full-time workers engaged in the same or similar kinds of work in the business or workplace concerned. It is necessary to pay various allowances etc. in accordance with the Rules of Employment and employment contracts, and not discriminate against ordinary workers. The subjects of discriminatory treatment are ① Wages ; ② Regular bonuses, holiday bonuses, etc. and bonuses paid regularly; ③ Incentives according to business performance; ④ Other matters concerning working conditions and benefits, etc. (Article 2 of the FPA) If a part-time employee has received discriminatory treatment, he/she may file a request for correction with the Labor Relations Commission; this shall not apply if six months have passed since such discriminatory treatment occurred (or since such treatment ended in cases of continuous discriminatory treatment). The procedures for this are the same as those for remedy application of an unfair dismissal case (Articles 8, 10 to 15 of the FPA). The employer shall not discriminate against the part-time worker for the reason that he has applied for correction of discrimination (Article 16 of the FPA). If the employer fails to perform the correctional order of the Labor Relations Commission without just cause, he shall be subject to a fine of up to KRW 100 million (Article 24 of the FPA)
2. Exceptions of applications for part-time workers
With respect to workers whose contractual working hours is an average of less than 15 hours per week over a four-week period (or the employment period, if they have been employed for less than four weeks), ① weekly holiday allowance (Article 55), ② annual paid leave (Article 60), ③ monthly paid leave (Article 60), and ④ severance pay (Article 34) shall not apply. In addition, social security insurances such as employment insurance, national pension and national health insurance except for industrial accident compensation insurance are excluded.
If the employer sets the contractual working hours of one week to 14 hours, and concludes the employment contract by adding an additional 2 hours of fixed overtime work every day (for 5 days), the Ministry of Labor has decided that the total working hours, including fixed extended working hours, are defined as working hours actually taken, as long as there is no reason to believe otherwise. In such case, part-time workers are subject to severance pay. However, it is possible to exclude from fixed working hours if it is not fixed overtime work but extension work due to an agreement with the company at that time.
V. Conclusion
The reason part-time workers have been subjected to relatively poor working conditions is that it is difficult to find the same kind of workers working in the same workplace, to be able to compare for discriminatory treatment. To protect against discriminatory treatment of part-time workers, it is necessary to expand the scope of full-time workers for comparison. In addition, in the case of workplaces with fewer than 5 employees, legal correction for discriminatory treatment is not possible, as these workers are excluded from the protection of the labor laws, which is a blind spot in the labor law because it does not apply to overtime, night work or holiday work. Therefore, for the active use of part-time workers, it is necessary to gradually expand the scope of full-time workers to be compared and to apply the Labor Standards Act to workplaces with fewer than 5 workers, to reduce discriminatory treatment.
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