Supreme Court Rules "In-House Subcontractors Are Also POSCO Employees"... Consecutive Recognitions of 'Illegal Dispatch'

Workers Secure Final Victory After 2022
Cold-Rolled Packaging Workers' Case Remanded
"Difficult to Conclude Dispatch Employment"

Workers at in-house subcontractors responsible for unloading and maintenance work at POSCO have been granted final recognition of illegal dispatch by the Supreme Court, paving the way for their direct employment. However, the court ruled that it could not definitively determine that workers handling some packaging work were dispatched employees.

Yonhap News Agency

On April 16, the First Division of the Supreme Court, presided over by Justice Shin Sook-hee, upheld the lower court's ruling in favor of 215 subcontracted workers in their appeal against POSCO regarding confirmation of employee status and related claims.

However, for workers who performed packaging work on cold-rolled steel products, the case was remanded, as the court found that these workers had specialized skills and discretion in adjusting their workload, making it difficult to conclude that they were in a dispatched employment relationship under POSCO’s direct supervision. Additionally, the claim of one worker who reached retirement age during the trial was dismissed ex officio due to lack of legal interest.

This case began when workers at in-house subcontractors at POSCO’s Pohang and Gwangyang steelworks demanded direct employment, claiming they were under the substantial direction and supervision of POSCO, the principal employer.

The key issue was whether a "dispatched employment relationship" existed between POSCO and the in-house subcontracted employees. In previous trials, both the first and second instances recognized illegal dispatch in most processes at POSCO. However, while the workers lost in the first trial regarding cold-rolled product packaging work, they won in the second trial when illegal dispatch was recognized in that area.

The Supreme Court rejected POSCO’s appeal for workers responsible for ship berthing, raw material unloading, ladle management, roll maintenance, and blended material production. The court acknowledged the principal employer’s actual direction and supervision, stating, “The subcontractors performed their work according to POSCO’s work standards and technical guidelines, and POSCO issued specific instructions as needed through its computerized system (MES) and messenger services.”

Employees of POSCO’s partner companies have continued lawsuits over illegal dispatch since 2011, and following victories in the first and second rounds of litigation in July 2022, they have now secured wins in the third and fourth rounds at the Supreme Court. POSCO recently announced a plan to directly employ about 7,000 partner company employees, but the labor union is protesting, calling the move “unilateral.”

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