Korean GM Former Employees Win Big in Average Wage Lawsuit... "Non-Prosecution Agreement Invalid"

[Image source=Yonhap News]

[Asia Economy Reporter Seongpil Cho] Retirees from Korea GM have won a lawsuit against the company regarding average wage claims. The court ruled that holiday gift expenses, etc., should be included in the average wage, and ordered the company to recalculate the severance pay by deducting the severance pay actually received by the retirees. Additionally, the court judged that the non-litigation agreement, which Korea GM obtained from the retirees, has no legal effect.

The Civil Division 41 of the Seoul Central District Court (Presiding Judge Myungsoo Kim) ruled in favor of the plaintiffs on the 10th in a wage claim lawsuit filed by 9,329 retirees, including Mr. Lim, against the company. The court ordered, "The defendant shall pay the plaintiffs a total of approximately 6.84 billion KRW and delayed interest."

Previously, Mr. Lim and others filed the lawsuit claiming that the company did not include pension insurance premiums (40,000 KRW per month) and holiday gift expenses (300,000 KRW per year) in the average wage when calculating severance pay. They also claimed delayed interest compensation from the company, arguing that the severance pay for retirees in 2018 was delayed. Furthermore, they demanded delayed damages on the 2018 performance bonus (4.5 million KRW per person). The total amount claimed reached approximately 6.84 billion KRW.

The court accepted all of Mr. Lim’s claims and dismissed the company’s argument regarding the non-litigation agreement. Korea GM had obtained a pledge from voluntary retirees in 2018 stating that they would not raise civil or criminal objections even if severance pay was delayed. This is known as the "non-litigation agreement." If this agreement had been upheld, the retirees’ claims would likely have been dismissed.

However, since the court did not recognize the validity of the non-litigation agreement, not only this case but also similar lawsuits by retirees against Korea GM in the future are likely to result in victories. Currently, two lawsuits regarding ordinary wages filed by retirees against Korea GM are being heard at the Incheon District Court.

This content was produced with the assistance of AI translation services.