In a recent case, a foreign English teacher in South Korea found herself in a difficult situation after leaving her job at a language academy. The teacher, whom we will call “Sarah,” had been introduced to the academy by our team of teacher recruiters. However, after she began working there, the employer transferred ownership of the academy to another person.
Despite completing her contracts with the new owner, Sarah did not receive her full severance pay. The new employer had only calculated the severance pay based on the approximately one year she had worked under their ownership, disregarding the period she had worked under the original owner. This discrepancy amounted to about 700,000 KRW. After numerous attempts to contact the academy’s director and discuss the issue, Sarah was either ignored or told that she had already been paid the correct amount.
Feeling frustrated and unsure of how to proceed, Sarah reached out to us for assistance. We agreed to guide her through the process of filing a complaint with the Ministry of Employment and Labor (MOEL).
After reviewing Sarah’s case, we calculated that she should have received 2.78 million KRW in severance pay, taking into account her entire employment period at the academy. However, she had only been paid 2.2 million KRW. Additionally, Sarah had not been able to take any of her entitled paid annual leave days, as the academy’s director had consistently denied her requests. The director had also deducted a cleaning fee from Sarah’s final salary without prior discussion or contractual agreement.
We assisted Sarah in filing a petition with the MOEL, claiming the unpaid severance pay, annual leave allowance, and the unjustly deducted cleaning fee. The total amount claimed was approximately 2.3 million KRW.
During the process, the labor officer informed us that the academy had fewer than five employees, which meant that the Labor Standards Act’s provisions on annual leave did not apply. In light of this information, we advised Sarah to withdraw the annual leave portion of her petition. However, we also recommended that she maintain the option to pursue this claim through a civil lawsuit (small claims court) if the employer refused to pay the unused paid leave allowance.
Furthermore, we instructed Sarah to inform the labor inspector that she would maintain the criminal complaint against her employer if they failed to pay all outstanding amounts, including the unused paid leave allowance. Although the annual leave claim was not protected by the Labor Standards Act due to the size of the business, the threat of criminal punishment could be used as leverage to pressure the employer. In South Korea, if an employee expresses their intent to seek punishment, the labor office is obligated to file a criminal complaint on behalf of the petitioner (employee). The withdrawal of this complaint is dependent on the petitioner’s decision.
This is a crucial piece of information for TEFL teachers in South Korea, as many of them work in small establishments. Understanding their rights and the legal mechanisms available to them can make a significant difference in resolving labor disputes.
The academy’s director was summoned to the labor office and given the opportunity to resolve the issue. During the discussion, the director raised concerns about the transfer of ownership and their responsibility for the severance pay from the previous owner’s period. We clarified that since the new owner had continued the same business without any changes, the employment relationship was comprehensively transferred to the new owner, who is responsible for the severance pay for the entire employment period.
After further discussion, the director agreed to pay the full amount owed to Sarah, totaling 2,277,834 KRW.
This case highlights the importance of understanding one’s rights as a foreign teacher in South Korea, particularly in situations involving a change of ownership. It also demonstrates the value of seeking assistance when faced with labor disputes. By working with knowledgeable recruiters and the MOEL, Sarah was able to successfully navigate the complaint process and receive the compensation she was entitled to under Korean labor laws. Moreover, it shows the effectiveness of using the threat of criminal punishment as a negotiating tool, even when certain claims may not be protected by the Labor Standards Act due to the size of the employer.
