Legitimacy of Dismissal Based on Performance Evaluation
– A Case of Disciplinary Dismissal for Lack of Teamwork and Communication Skills –

Bongsoo Jung / Korean labor attorney

I. Summary
In October 2022, the employee was employed as an accounts manager by Company T and, due to a poor personnel evaluation result, she was dismissed in September 2024. She received a less than satisfactory level on the teamwork portion and communication skills implemented in early 2024. Due to this poor result, the employee was put into the subject to the “Performance Improvement Plan (PIP)” in April 2024. As the employee could not accept the inferior parts of the personnel evaluation, she rejected the repeated requests from the department head to submit the PIP. Therefore, the company initiated a “Corrective Action Plan” (CAP) concerning the employee in May 2024, where the department head evaluated whether her teamwork and communication skills improved during the following three months. The company did not find any improvement in her attitude and determined there would be no possibility for any progress. As a result, the company made a disciplinary dismissal for her on September 18, 2024. The employee filed a relief application for unfair dismissal, claiming that the dismissal by means of short-term poor personnel evaluation result would be too severe a punishment in terms of common societal standards and is therefore not justifiable.

II. Company T’s Claim

1. Reason for dismissal
The employee received a less than satisfactory level in her 2023 personnel evaluation especially in regards to her teamwork and communication skills. Since the department head recognized that the employee could not get along with her team members and even caused disputes with them due to her uncontrollable hot-temper, the department head reminded the employee several times that the teamwork would be major evaluation criteria in here 2023 personnel evaluation. When the department head asked her four times to submit the performance Improvement Plan (PIP) for the inferior parts of her 2023 evaluation result, she did not submit the PIP, making excuses repeatedly. The company gave her a final chance through the Correction Action Plan (CAP), but her resistance toward improving her performance worsened the situation.

2. Justification of the dismissal
The employee had frequently showed excessive anger at work. She reacted sensitively to criticism, she spoke ill of other coworkers and the company, all of which deteriorated the workplace atmosphere. The employee also showed unacceptable behavior and an immature attitude at work toward her superior and fellow coworkers, which affected her work negatively. In addition, the company provided enough opportunities for her to improve her attitude through verbal and written warnings, the PIP, and the CIP in the disciplinary process, but she ignored these efforts and showed no change in her attitude. Accordingly, the company decided to dismiss the employee according to the related provision of the Rules of Employment, judging that the company could no longer expect any improvement from her.

III. Employee’s Claim

1. Problem in reasons for dismissal
During the last two years since joining the company, the employee had not been absent without permission or had never seriously violated the company’s rules, and, in 2023, she worked more hours, including overtime, holiday and night work, than any other coworker on her finance team. The reason for the employee’s dismissal was because of her lack of teamwork and poor communication skill in her accounting department. The employee was dismissed in the personnel evaluation not because of her vocational ability, but because of her teamwork and communication issues evaluated by the department head’s subjective judgment. That is to say, the reasons for dismissal were due to the poor teamwork and communication problem during her personnel evaluation, and as the employee could not improve those portions at the Corrective Action Plan (CAP), she was dismissed. Here, the main issues to be considered are: 1) whether dismissal of an employee because of a poor personnel evaluation is possible? 2) whether it is justifiable to dismiss an employee because of poor teamwork and a lack of communication skill in a personnel evaluation?
1) Whether dismissal of an employee because of a poor personnel evaluation is possible?
In order that a dismissal because of a poor personnel evaluation can be justified, the personnel evaluation shall be equitable, and the employee’s performance result shall be inferior in an objective view to a level where the company could not maintain its employment with the employee in terms of common social norms.
2) Whether it is justifiable to dismiss an employee because of poor teamwork and a lack of communication skill in a personnel evaluation?
The employee had handled her duties in accounting, tax, and customs clearance issues very professionally as a first-line, person-in-charge and had been well recognized by persons-in-charge from other relevant departments. Concerning the poor teamwork and communication problem, the department head had to manage his/her subordinate employees and make every effort to promote overall cooperation at work with amicable communication among department members, but the department head attributed the employee’s problems as an individual fault and regarded the problems as reasons for dismissal. These problems could be too severe to cut off the employment with the employee in terms of common social norms.

2. Problem in application of disciplinary punishment
The employee had carried out her duties sincerely without ever missing deadlines during the last two years of employment. The reason for dismissal was due to low grade in her personnel evaluation. The poor performance result was not due to vocational ability, but due to the employee’s lack of teamwork and communication skill. It could be estimated that the employee’s lack of teamwork and communication skill might be solved by the department head’s leadership and special team-building activities between department members. However, without these efforts, the department head took advantage of the poor personnel evaluation result to dismiss the employee. Even though the department head judged that the employee had severe faults, which are subject to disciplinary action, dismissal was too severe of a disciplinary measure and was therefore an abuse of the employer’s personnel right.

IV. Related judicial rulings

1. The company dismissed the employee because she received four consecutive low grades on her personnel evaluation, which is an abuse of the employer’s personnel right. (Seoul District Court on Jan 27, 2006, 2005 Kuhap 23879)
As the company’s personnel evaluation system was used not by an absolute grading method, but by a relative grading method, the employee’s vocational ability could not be evaluated objectively just because he/she received the lowest grade in the personnel evaluation. In the personnel grading process, the department head and the directors concerned admitted that the employee had technical vocational ability and professional knowledge, but the employee’s problems in human relations had caused frequent disputes in the workplace. In reviewing all circumstances, the company dismissed the employee only because of her four consecutive low grades on the personnel evaluation, which could not be regarded objectively as a justifiable dismissal. Accordingly, this dismissal due to this personnel grading is an abuse of the employer’s personnel right.

2. When the company dismissed the employee who received the lowest grades in two consecutive personnel ratings according to the Personnel Evaluation Regulation, it is not an abuse of the employer’s disciplinary right. (Seoul District Court ruling on Dec 28, 2004, 2003 Guhap 39306)
The employee received the lowest personnel grade ‘C’ in two consecutive personnel ratings in the second half of the year 2001 and in the second half of the year 2002. In the past, the employee had also received disciplinary punishments several times due to poor personnel ratings. In reviewing such circumstances, when the company dismissed the employee who received the lowest grades in the two consecutive personnel ratings, it is not an abuse of the employer’s disciplinary right.

3. It is justifiable to dismiss the employee who has been given continuously low grades in her personnel review. (Seoul District Court ruling on Jan 24, 2003, No 4, 2002 Guhap 16306)
The employee’s job was to handle assistant personnel affair, which was rather simple and regular work. Even though the employee had conducted the same work for many years, the employee repeated similar kinds of mistakes. Therefore, every year at the personnel evaluation, the employee received directions that required the improvement of work skill and related knowledge, but the employee did not make any progress. In fact, the employee’s ability got worse. In reviewing all the circumstances, even though the employee suffered from the disadvantage resulting from the dismissal, this employer’s dismissal could be neither too harsh nor the abuse of the disciplinary right.

V. Conclusion
The company dismissed the employee after just one year’s personnel evaluation, and furthermore, the personnel evaluation was not made on vocational ability, but on a subjective judgment on her team work and communication problems. After considering all the circumstances, the company expected an unfavorable result by the labor commission and therefore suggested a compromise. The employee accepted a settlement of the case. The conditions of the settlement were that the company would pay 8 months of additional salary and give a positive answer for any reference checks from potential employers.