Supreme Court: "Church Evangelists Are Also Workers Under the Labor Standards Act"

Pastor Fined 5 Million Won for Failing to Pay Severance and Unpaid Wages on Time Confirmed

The Supreme Court has ruled that church evangelists also qualify as workers under the Labor Standards Act.

According to the legal community on the 22nd, the Supreme Court's 2nd Division (Presiding Justice Min Yu-sook) upheld the original sentence of a 5 million won fine in the final appeal trial of Pastor Lee (69), who was indicted for violating the Labor Standards Act and the Act on the Guarantee of Employees' Retirement Benefits (Retirement Benefits Act).

Lee, the head pastor of a church in Chuncheon-si, Gangwon-do, was indicted for failing to pay wages of 79.95 million won and retirement pay of 17.58 million won on time to evangelist A, who worked from October 2012 to June 2018 and then retired.

The Labor Standards Act stipulates that when a worker retires, all payments such as wages and compensation must be paid within 14 days to settle accounts, and violation of this is punishable by imprisonment of up to three years or a fine of up to 30 million won.

The Retirement Benefits Act requires employers to pay retirement benefits within 14 days after a worker retires, and violations are similarly punishable by imprisonment of up to three years or a fine of up to 30 million won.

The first trial court acquitted Lee, ruling that A could not be considered a worker under the Labor Standards Act.

A had submitted a pledge to Lee agreeing to work under an annual salary system instead of signing a labor contract, but the court cited the absence of specific details about the work or compensation in the pledge and the lack of employment rules or personnel regulations applicable to evangelists like A at Lee’s church as reasons.

A received a monthly stipend of about 1.1 to 1.4 million won, which the court viewed not as compensation for labor but as a token payment to support living expenses.

However, the second trial court’s judgment differed. The appellate court ruled that A should be considered a worker under the Labor Standards Act and sentenced Lee to a fine of 7 million won.

The court examined A’s worker status based on the Supreme Court’s position that whether a person qualifies as a worker under the Labor Standards Act should be judged by the substance of whether the worker provided labor to the employer in a subordinate relationship for wages, rather than the form of the contract being an employment or a service contract.

It concluded that A was a worker based on the following: ▲ Lee’s church was registered as a business under “other religious organizations” with Lee as the business owner ▲ the church withheld income tax on the fixed salary paid to A ▲ A was enrolled as a “workplace subscriber” in the National Pension and Health Insurance with the church as the workplace during employment ▲ A received direct and indirect specific instructions and supervision regarding work from Lee, the head pastor.

The court stated, "A received a fixed amount regularly from the church as a stipend, which regardless of its name or title, appears to have been paid as compensation for labor as an evangelist," adding, "The pledge in this case also included the term 'annual salary system.'"

It further noted, "Lee withheld income tax on the stipend paid to A and enrolled A as a 'workplace subscriber' in the National Pension and Health Insurance with the church as the workplace," adding, "Thus, Lee enabled A to receive social security benefits based on A’s status as a worker."

The Supreme Court also found no problem with the appellate court’s judgment recognizing A as a worker. However, the Supreme Court partially acquitted Lee of some charges upheld by the appellate court and remanded the case in June last year.

Regarding some unpaid wages and 410,000 won in unused annual paid leave allowance, the Supreme Court ruled that the three-year statute of limitations under the Labor Standards Act had already expired, so Lee had grounds to dispute the payment obligation, and thus the intent to violate the Labor Standards Act could not be recognized for those parts, resulting in acquittal.

The Chuncheon District Court, upon receiving the case again, followed the Supreme Court’s remand instructions, acquitted Lee of the relevant parts, and reduced the fine to 5 million won.

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