<The 2nd labor forum on ‘indirect employment’: in-house outsourcing and the Labor Law 2>

<The 2nd labor forum on ‘indirect employment’: in-house outsourcing and the Labor Law 2>

In order to search for various ways to tackle indirect employment affecting women which continues a trend of increase, the KWWA and KWTU looked at regulations regarding indirect employment in the 2nd labor forum as well as the 1st labor forum. 

In-house outsourcing in Korea is as wide spread as people associate indirect employment to in-house outsourcing. In fact, since the division between dispatched employment and in-house outsourcing is very unclear and workers are mostly illegally dispatched, measures should be taken. However, using the economic crisis as an excuse, the government has attempted to make undesirable amendment of the Temporary Employee Protection Act, by allowing of overall dispatched employment.  Because no regulations or restrictions on in-house outsourcing are imposed, a wide range of dispatched employment and subcontracting will be employed in the society.

If raised is the point that in-house subcontracting is illegal,
-when the subcontracting company is not able to have independent management, the actual employment relation between outsourced workers and the actual user is considered as ‘implied employment contract.’ In this case, it is apparently decided as camouflaged outsourcing or subcontracting.
-If this judgment is made, since outsourced workers can be regarded as indirectly employed regular workers by the actual user, full coverage including retirement allowances and wages should be compensated from the point when they become employed.  If the company does not try to fulfill this, it has to dismiss workers. However, whether the dismissal is legal and suitable should be judged in the court.

However, in case in which it is decided that the subcontractor has independent management, whether the employment is illegal dispatch or not will be judged.  So far, only camouflaged dispatched employment which is actual outsourcing has been considered as an important issue by the court.

However, at this point in the case of undisguised dispatched employment, the dispatches, not allowed by the Temporary Employee Protection Act have failed in the court. That is because the Temporary Employee Protection Act regulates only proper dispatches.  However, exceptionally, like the Yesco case, illegal dispatches should be regulated by the law.

Like the Yesco case, illegal dispatches can be decided by the Temporary Employee Protection Act, and the illegal dispatches also be regulated by the Employment Security Act.

The following suggestions were made during the forum in order to regulate in-house outsourcing legally:
- If businesses are not shut down and continued to be run by new subjects, even though there are changes in subjects of businesses, the businesses should not be considered by the sales of operations but the concept of business transfers.
- As long as the contractor and the subcontractor form ‘one business’ due to the expansion of user’s responsibility, both of the contractor and the subcontractor should take responsibility in solidarity, in relation to the application of the labor related law.
- The Discrimination Prevention Act should be enacted. 

The 1st and 2nd labor forums gave us good opportunities to discuss formulas to tackle the issue of in-house outsourcing.  Even though there is a long way to go, the forums served as springboards for realizing the importance of positive precedents and the efforts to make legal reforms.