Law: "Korea Hydro & Nuclear Power Pays Over 30 Billion Won in Overtime Allowances to UAE Dispatchers"

Korea Hydro & Nuclear Power (KHNP) was ruled by the court to include overseas work allowances in the ordinary wages when determining overtime pay for employees dispatched to the United Arab Emirates (UAE).

Seoul Central District Court. / Photo by Mun Ho-nam munonam@

According to the legal community on the 28th, the Seoul Central District Court Civil Division 42 (Presiding Judge Jung Hyun-seok) ruled in favor of the plaintiffs in the first trial of a wage payment lawsuit worth 30.9 billion KRW filed by A and about 1,170 others against KHNP. The average amount per person is approximately 26.32 million KRW.

The court stated, "The overseas work allowance paid to A and others cannot be regarded as a reimbursement of actual expenses but is recognized as wages," and added, "It is ordinary wages regularly, uniformly, and fixedly paid as compensation for prescribed work."

Furthermore, the court said, "The obligation to pay wages, including overseas work allowances and overtime pay, lies with KHNP," and "The overseas work allowance corresponds to ordinary wages for which the defendant has the payment obligation."

Earlier, Korea Electric Power Corporation (KEPCO) signed a contract related to the construction of a nuclear power plant with the Emirates Nuclear Energy Corporation (ENEC) in December 2009. KEPCO entered into an 'Agreement on Joint Management of UAE Nuclear Power Plant Project' with KHNP to carry out the project.

A and others were dispatched to the UAE according to personnel orders. They were responsible for technical support in the construction field at KEPCO's joint project headquarters.They received a monthly overseas work allowance separately from the salary set by KHNP's employee annual salary regulations.

A’s side filed a lawsuit claiming the difference between the overtime pay calculated by including the overseas work allowance in the ordinary wages and the overtime pay actually paid, arguing that "KHNP calculated ordinary wages excluding the overseas work allowance and paid overtime pay to the plaintiffs."

KHNP argued, "The overseas work allowance in this case is a living expense allowance overseas, a reimbursement of actual expenses, and is not recognized as wages." They also claimed, "Since the allowance has been paid by KEPCO, not the defendant, the payment obligation does not lie with the defendant."

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