Key Limits on Employer Latitude in Structuring Workforce

South Korea is commonly spoken of as a country with burdensome or inflexible employment laws. This article highlights four key sets of legal limits upon employers in Korea, in part reinforced by new legislation.

For the most part, these limits apply to workplaces with five or more employees. Of pervasive importance in this area is the Labour Standards Act (LSA), the bedrock of employment law in Korea.

First, terminating an employee requires "just cause", or substantial justification, under the LSA. Korea is not an "at-will" employment jurisdiction. Generally, there must be some justification beyond mere redundancy, and also beyond mere humdrum performance. The occasional instance of mild negligence, for example, or inaptitude for relatively minor aspects of the work, usually will not rise to just cause, but gross and repetitive incompetence will.