[Gwanga in] Bank of Korea 'Suspicion of Illegal Dispatch of Security Personnel', Ministry of Employment Finally Conducts Labor Inspection

Bank of Korea: "Security Services Act Takes Precedence Over Dispatch Act... No Illegal Possession"
"Please Recognize On-Duty Allowance as Overtime Pay" Wage Arrears Complaint Also Filed

The Ministry of Employment and Labor has begun supervising whether special security guards responsible for security duties at the Bank of Korea are illegally dispatched workers. The ministry aims to verify if the employment form of the special security guards belonging to an outsourced company contracted with the Bank of Korea has the potential for disguised subcontracting. In addition, the Ministry of Employment and Labor is also checking for any wage arrears related to overtime pay for the special security guards.

According to a comprehensive report by Asia Economy on the 22nd, the Seoul Regional Employment and Labor Office of the Ministry of Employment and Labor sent an official letter to the Bank of Korea’s Human Resources System Team and started labor supervision last week, securing related materials and conducting surveys targeting the special security guards.

This supervision by the Ministry of Employment and Labor was initiated following a request for labor supervision concerning the Bank of Korea’s special security guards. A ministry official stated, "We began supervision due to petitions regarding illegal dispatch and complaints about wage arrears," adding, "The supervision is currently ongoing."

The authority to command and direct workers depends on whether the contract form is 'dispatch' or 'subcontract.' In the case of dispatch, the authority lies with the user company, whereas in subcontracting, it lies with the subcontractor. If the user company gives specific work instructions to workers under a subcontract, it may be judged as worker dispatch rather than subcontracting, which constitutes 'illegal dispatch' violating the 'Act on the Protection, etc. of Dispatched Workers.' Aware of this, the Bank of Korea’s Legal and Regulatory Affairs Office prepared and internally shared a document in June cautioning that the Bank’s subcontract contracts could be considered illegal dispatch.[Related article: 'High-security facility' Bank of Korea, controversy over security 'illegal dispatch']

However, the Bank of Korea believes that, legally, the case of the special security guards is unlikely to be recognized as illegal dispatch. A representative from the Bank’s Legal and Regulatory Affairs Office explained, "Special security guards are subject to the supervision and command of the facility owner under the Security Services Act due to the nature of security duties, which takes precedence over the Dispatch Act," adding, "Because the essence of their work is guarding a security facility, if they were not supervised due to working under a subcontract contract, they would not be able to properly fulfill their duties."

A Ministry of Employment and Labor official said, "While it is true that the Security Services Act takes precedence over the Dispatch Act, it is necessary to verify whether the subcontract work was limited to the scope of the Security Services Act or if there was command and instruction beyond that," adding, "Since supervision has only recently begun, we need to further ascertain the facts."

The wage arrears being checked alongside illegal dispatch by the Ministry of Employment and Labor concern the special security guards’ night work allowances. They are verifying whether the night security pay, previously given as 'duty allowance,' should have been paid as 'overtime pay.' Duty allowance refers to wages paid for ancillary work outside regular duties. In contrast, overtime pay is paid when performing regular work beyond prescribed working hours and is generally higher than duty allowance. Company A, to which the Bank of Korea’s special security guards belong, sent a formal demand to the Bank on the 6th, requesting retroactive payment of duty allowances as overtime pay for the three years from March 2019 to February 2022. If wage arrears are confirmed, corrective measures may be ordered to pay the unpaid amounts.

Regarding the recognition of night work allowance as overtime pay, there is a precedent involving the Bank of Korea’s regular employees who are security officers. Former and current security officers and security personnel filed a lawsuit against the Bank, claiming that duty work should be considered regular work and thus entitled to overtime pay. In July, the security officers ultimately won the case.

A special security guard at the Bank of Korea said, "In the case of security officers, they continued the lawsuit on the same issue and were eventually recognized as performing qualitatively identical work during day and night shifts, receiving overtime pay belatedly. The special security guards’ day and night duties are essentially the same in quality," adding, "Security officers proceeded with the lawsuit through their union and eventually received unpaid amounts, but since special security guards belong to an external company, they did not have such a process. If this is overlooked, it would be unfair."

If illegal dispatch is recognized as a result of this labor supervision, the Bank of Korea is likely to receive corrective orders to directly employ the special security guards. However, this would pose difficulties for the Bank because the Ministry of Economy and Finance, not the Bank of Korea, determines personnel expenses. Subcontract contracts are treated as business expenses rather than personnel expenses, so there is no particular problem, but direct employment would require discussions with the Ministry of Economy and Finance.

Regarding the issue of overtime pay, the Bank of Korea also takes the position that further legal examination is necessary. A Bank official said, "The parties with whom the special security guards have contracts are not the Bank of Korea but the subcontracting companies, so strictly speaking, the obligation to pay wages lies with the companies," adding, "As a public institution with issuing authority, it is our primary duty to review the legal basis for payment."

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