Legal Issues in the "CU Incident": Key Focus Is Whether Delivery Drivers Qualify as "Workers" Under the Trade Union Act

Published 27 Apr.2026 14:30(KST)

The so-called "CU incident" has erupted as delivery drivers affiliated with the Cargo Solidarity Union under the Korean Confederation of Trade Unions (KCTU) and part of the CU branch, began an indefinite strike demanding negotiations with BGF Retail, the operator of CU. On April 20, a union member attempting to block substitute freight trucks near the Jinju logistics center was struck by a vehicle and died. With the strike ongoing, not only franchisees-third parties-but also partner companies supplying products to CU are reporting damages. BGF Logistics has filed an injunction against the Cargo Solidarity Union to prohibit obstruction of business.

On the afternoon of the 20th, a Cargo Solidarity member confronted the police while trying to enter the entrance of the BGF Logistics Jinju Center in Jeongchon-myeon, Jinju City, Gyeongnam Province. Photo by Yonhap News Agency

Previously, the Cargo Solidarity Union demanded negotiations, claiming that BGF Retail is the "employer." According to the union, BGF Retail exercises "substantial control" over delivery drivers’ fares, volume, and working conditions. However, BGF Retail maintained that it is not a contracting party and therefore is not a party to the negotiations. There is a five-stage subcontracting structure among BGF Retail, its logistics subsidiary BGF Logistics, the logistics center, regional carriers, and the delivery drivers. Cargo Solidarity Union and BGF Logistics held a preliminary meeting on April 22 and discussed future negotiation schedules.

While much attention is being paid to the question of who the "employer" of the delivery drivers is in this matter, legal experts point out that the core issue is not the identity of the employer but rather whether the Cargo Solidarity Union drivers qualify as "workers" under the Trade Union Act. For these drivers to designate BGF Retail as the so-called "de facto employer" as specified in the Yellow Envelope Act and to demand negotiations, they must first be recognized as "workers" as defined by the Act. Experts agreed, stating, "If worker status is denied, there is no point in discussing the identity of the employer. If they are not considered workers under the Trade Union Act in the first place, they cannot claim employer status over any party." The concept of "employer status" refers to the legal status that entails responsibilities and obligations toward workers.

In particular, there is no established precedent yet as to whether Cargo Solidarity Union delivery drivers qualify as "workers" under the Trade Union Act. For this reason, experts say, "Ultimately, we must await the court’s decision." Several legal professionals have examined the key issues surrounding this dispute.

Are Cargo Solidarity Union Delivery Drivers Considered Workers Under the Trade Union Act?

Experts analyze that drivers of large freight vehicles often have characteristics of independent entrepreneurs, making it difficult for them to be recognized as "workers." According to experts, to be recognized as a "worker" under the Trade Union Act, there must be "exclusivity." "Exclusivity" refers to entering into a contractual relationship with a specific employer at a particular business establishment, providing labor, and primarily relying on that employer for income.

A lawyer who previously served as a Supreme Court judicial research officer commented, "In previous cases where worker status was recognized under the Trade Union Act, 'exclusivity' with the business establishment was a key criterion." He added, "Given the aspect of exclusivity, it may be difficult for Cargo Solidarity Union delivery drivers to be recognized as workers."

Although there are precedents where the court recognized parcel delivery drivers as workers under the Trade Union Act, some argue that these cannot be directly applied to the present case. A lawyer at a major law firm and a former high court judge explained, "There are cases where parcel delivery drivers have been recognized as workers under the Trade Union Act, but it is difficult to apply this directly to freight truck drivers. This is because freight truck drivers typically invest more capital and thus have stronger characteristics of independent business owners than parcel delivery drivers."

A mid-career lawyer specializing in labor law also stated, "Cargo Solidarity Union delivery drivers have such strong characteristics of independent business owners that it is difficult to apply precedents recognizing worker status under the Trade Union Act as they are." However, he added, "Since the courts have been gradually expanding the scope of worker status under the Trade Union Act, we cannot completely rule out the possibility that worker status may be recognized in the future."

Does Blocking Logistics Centers Constitute the Crime of Obstruction of Business?

Experts analyze that the Cargo Solidarity Union's actions in blocking major logistics centers could constitute the crime of business obstruction, making criminal punishment possible.

A labor group lawyer at a major law firm explained, "Even if they are recognized as workers, if they engage in violence or fail to meet the legal requirements for a legitimate strike, it is considered an illegal strike and subjects them to criminal liability." Even if recognized as a union, if the proper procedures for industrial action are not followed, members may face criminal charges.

However, other opinions point out that the Supreme Court has recently interpreted the requirements for obstruction of business under criminal law more strictly, so whether the specific requirements are met should be examined on a case-by-case basis. Another lawyer commented, "Basically, physically blocking another person’s normal business constitutes obstruction of business, but if the act was intended to block the company’s illegal deployment of substitute workers during a lawful strike, there is room for it to be considered a justifiable act."

Can Franchisees, as Third Parties, File Direct Damage Claims?

Another issue is whether franchisees, who have suffered significant business losses due to logistics disruptions, can claim direct damages against the delivery drivers.

A former high court judge explained, "If it is a lawful strike, franchisees should hold the headquarters liable for contractual obligations. However, if it is deemed an illegal strike and illegal blockade, franchisees may directly claim damages from individual freight truck drivers." Another labor group lawyer at a major law firm stated, "Regardless of whether the drivers are recognized as workers, franchisees who suffer business losses from not receiving logistics supplies due to illegal blockades may file damage claims against the delivery drivers."

However, since franchisees are third parties, when making damage claims based on unlawful acts, the burden of proof may arise. A lawyer who previously served as a judicial research officer explained, "There is no direct contractual relationship between franchisees and delivery drivers, so when filing a claim for damages based on an unlawful act, franchisees must prove the causality that business losses occurred as a result of delivery drivers blocking the logistics centers."

A representative of the CU Franchise Owners Association stated, "Currently, for franchisees located in provincial areas, only some of the daily logistics deliveries are arriving on designated days," and added, "We have sent a notarized letter demanding normalization of logistics to BGF Retail, BGF Logistics, and the Cargo Solidarity Union."

Not only franchisees, but also partner companies of BGF Retail, are reportedly suffering significant losses. A representative of a partner company supplying products to CU said, "The lost opportunity cost in sales amounts to several billion won," adding, "This is an issue where even the recognition of worker status is being contested, and with an indefinite strike and business obstruction, companies that mainly supply to CU are suffering substantial damages."

BGF Logistics: "Cargo Solidarity Union Is Not Subject to the Yellow Envelope Act"

In a press release distributed on the 23rd, BGF Logistics announced its official position that the Cargo Solidarity Union is not subject to the Yellow Envelope Act, and that BGF Retail is not an employer and thus cannot be a party to negotiations.

Regarding the Cargo Solidarity Union's demand to negotiate with BGF Retail, which is not the principal in the logistics contract, BGF Logistics stated, "BGF Retail cannot be a party to negotiations because, under the business structure, there is no clear basis for substantial control or employer status."

Meanwhile, after the fatal accident involving a union member on April 22, BGF Logistics sat down at the negotiating table with the Cargo Solidarity Union. However, BGF Logistics drew a clear line, stating that this did not represent recognition of employer status. BGF Logistics explained, "The preliminary meeting with the Cargo Solidarity Union on April 22 was held to seek a prompt resolution given the ongoing damages to franchisees," adding, "This does not mean we recognized employer status."

A labor law specialist at a major law firm commented, "Even if an organization is a business association rather than a labor union, negotiations or discussions with a company are possible. However, the mere fact that a company participates in discussions does not immediately establish an obligation for collective bargaining under the Trade Union Act or recognition of employer status."

Reporter: Han Mina, The Legal Times