Corporate trends / Performance record
Unfair Dismissal Decision on “Refusal to Renew (C-Grade Performance Evaluation)” (Unfair Dismissal 338)
- Date2026/04/02 04:04
- Read 176
This case concerns an unfair dismissal decision on the issue of “refusal to renew (C-grade performance evaluation)” in which the employer ultimately prevailed (application dismissed).
Adjudicating body: Jeonnam Regional Labor Relations Commission, 2026 Unfair Dismissal 6 ○ ○ ○ Application for Remedy for Unfair Dismissal
Decision date: 2026.02.26 · Case result: Dismissed
Summary of key issue:
A. Whether a legitimate expectation of renewal existed
Since it was recognized that, for all fixed-term employees, the employer had in most cases either converted them to permanent status or renewed their contracts upon expiry, the employee was also deemed to have a legitimate expectation of renewal.
1. Legal Implications
Ⅰ. Case Overview
In this case, the applicant, a fixed-term employee, expected renewal of the employment contract as the expiry date approached. The employer, however, refused to renew the contract, citing the results of the employee’s performance evaluation, and the employee filed an application with the Labor Relations Commission claiming unfair dismissal. The Jeonnam Regional Labor Relations Commission examined the employer’s overall management of fixed-term employees, its practice of renewal, and the procedures for performance evaluation and interviews, and rendered a decision on both the existence of a legitimate expectation of renewal and the justification for the refusal to renew.
Ⅱ. Issues
The issue in this case is:
“In a situation where a fixed-term employee is recognized as having a legitimate expectation of renewal, whether there is a reasonable ground for refusing to renew the contract on the basis of a C-grade, the lowest performance evaluation rating, such that the refusal cannot be regarded as an unfair dismissal.”
Ⅲ. Summary of the Labor Relations Commission’s Decision
The adjudicating panel in this case noted that: the employer had, in most cases, repeatedly converted fixed-term employees to permanent status or renewed their contracts upon expiry; based on this practice, the employee was also recognized as having a legitimate expectation of renewal; the employer conducted a performance evaluation and interviews of the employee to determine whether to renew, and the employee received a C-grade, the lowest rating among those evaluated; and, absent special circumstances, employers are afforded considerable discretion in performance evaluations.
In light of the legal principle that, even where a legitimate expectation of renewal is recognized, an employer may refuse renewal for reasonable grounds, the panel held that, given the existence of a performance evaluation and evaluation procedure and the fact that the employee’s result was markedly low, the refusal to renew was supported by socially acceptable and sufficiently reasonable grounds. Accordingly, it ruled that the refusal to renew did not constitute an unfair dismissal.
Ⅳ. Practical Points (From the Employee’s Perspective)
Even as a fixed-term employee, if the company has accumulated a practice of repeated renewals or conversions to permanent status, a legitimate expectation of renewal may be recognized. In such cases, the employer’s refusal to renew can be challenged as tantamount to a dismissal. However, as in this case, where the performance evaluation result is significantly lower than that of colleagues and the evaluation and interview procedures have been conducted in a consistent manner, the Labor Relations Commission may broadly recognize the employer’s discretion. Therefore, it is necessary for employees to accumulate objective materials regarding their work performance and attitude (performance indicators, completion of training, records of objections to superiors’ evaluations, etc.) on an ongoing basis.
Ⅴ. Practical Points (From the Employer’s/Company’s Perspective)
Where fixed-term employees are repeatedly renewed or mostly converted to permanent status, there is a high likelihood that a legitimate expectation of renewal will be recognized. Employers should therefore clearly establish in advance, and operate consistently, the criteria and procedures for renewal (evaluation items, scoring standards, interview methods). In particular, as in this case, if the fact that the employee received the lowest rating through performance evaluations and interviews, and that the evaluation was conducted according to objective criteria, is documented and recorded, the likelihood that the Labor Relations Commission or the courts will recognize reasonable grounds for refusal to renew will be higher.
This type of decision illustrates how a fixed-term employee’s legitimate expectation of renewal and the employer’s discretion in evaluation are balanced in unfair dismissal disputes. Both employees and employers are advised to seek assistance from experts such as Labor Law Firm Law& to review in advance the design of performance evaluation systems and strategies for responding to disputes.
2. Matters Adjudicated
A. Case Overview and Procedural History
A. Whether a legitimate expectation of renewal existed
Since it was recognized that, for all fixed-term employees, the employer had in most cases either converted them to permanent status or renewed their contracts upon expiry, the employee was also deemed to have a legitimate expectation of renewal.
B. Whether there were reasonable grounds for refusal to renew
To determine whether to renew the employee’s contract, the employer conducted and evaluated performance assessments and interviews. The employee’s evaluation score corresponded to a “C” grade, the lowest among those evaluated, and, absent special circumstances, the employer’s performance evaluations are afforded considerable discretion. Therefore, reasonable grounds for the refusal to renew were recognized.
3. Summary of the Decision
A. Summary of the Labor Relations Commission’s Reasoning
A. Whether a legitimate expectation of renewal existed
Since it was recognized that, for all fixed-term employees, the employer had in most cases either converted them to permanent status or renewed their contracts upon expiry, the employee was also deemed to have a legitimate expectation of renewal.
B. Whether there were reasonable grounds for refusal to renew
To determine whether to renew the employee’s contract, the employer conducted and evaluated performance assessments and interviews. The employee’s evaluation score corresponded to a “C” grade, the lowest among those evaluated, and, absent special circumstances, the employer’s performance evaluations are afforded considerable discretion. Therefore, reasonable grounds for the refusal to renew were recognized. /
[Further Related Decisions]
- “Unfair Dismissal Decision on ‘Failure to Meet Requirements for Redundancy Dismissal (Workout Company)’”
- “Unfair Dismissal Decision on ‘No Formation of Hiring Commitment (Absence of Offer Letter)’” – Decision date: – Case result: First-instance decision upheld
- “Unfair Dismissal Decision on ‘Expression of Intention to Resign (Resignation Remark in Telephone Call)’”
[Tags]
Unfair dismissal, refusal to renew (C-grade performance evaluation), refusal to renew fixed-term contract, personnel evaluation · poor performance, Labor Law Firm Law&, large labor law firm, Samseong-dong labor law firm, Samseong Station labor law firm, Gangnam labor law firm
※ This article is part of the “Unfair Dismissal Decisions” series by Labor Law Firm Law&.
※ The previous article, “Unfair Dismissal Decision on ‘Excessive Disciplinary Measure (Concurrent Position at University)’,” can be viewed in a new window.
※ The list of decisions related to refusal to renew (C-grade performance evaluation) can be viewed together at “List of Decisions Related to Refusal to Renew (C-Grade Performance Evaluation).”
※ Korean version of this case: Korean article
Adjudicating body: Jeonnam Regional Labor Relations Commission, 2026 Unfair Dismissal 6 ○ ○ ○ Application for Remedy for Unfair Dismissal
Decision date: 2026.02.26 · Case result: Dismissed
Summary of key issue:
A. Whether a legitimate expectation of renewal existed
Since it was recognized that, for all fixed-term employees, the employer had in most cases either converted them to permanent status or renewed their contracts upon expiry, the employee was also deemed to have a legitimate expectation of renewal.
1. Legal Implications
Ⅰ. Case Overview
In this case, the applicant, a fixed-term employee, expected renewal of the employment contract as the expiry date approached. The employer, however, refused to renew the contract, citing the results of the employee’s performance evaluation, and the employee filed an application with the Labor Relations Commission claiming unfair dismissal. The Jeonnam Regional Labor Relations Commission examined the employer’s overall management of fixed-term employees, its practice of renewal, and the procedures for performance evaluation and interviews, and rendered a decision on both the existence of a legitimate expectation of renewal and the justification for the refusal to renew.
Ⅱ. Issues
The issue in this case is:
“In a situation where a fixed-term employee is recognized as having a legitimate expectation of renewal, whether there is a reasonable ground for refusing to renew the contract on the basis of a C-grade, the lowest performance evaluation rating, such that the refusal cannot be regarded as an unfair dismissal.”
Ⅲ. Summary of the Labor Relations Commission’s Decision
The adjudicating panel in this case noted that: the employer had, in most cases, repeatedly converted fixed-term employees to permanent status or renewed their contracts upon expiry; based on this practice, the employee was also recognized as having a legitimate expectation of renewal; the employer conducted a performance evaluation and interviews of the employee to determine whether to renew, and the employee received a C-grade, the lowest rating among those evaluated; and, absent special circumstances, employers are afforded considerable discretion in performance evaluations.
In light of the legal principle that, even where a legitimate expectation of renewal is recognized, an employer may refuse renewal for reasonable grounds, the panel held that, given the existence of a performance evaluation and evaluation procedure and the fact that the employee’s result was markedly low, the refusal to renew was supported by socially acceptable and sufficiently reasonable grounds. Accordingly, it ruled that the refusal to renew did not constitute an unfair dismissal.
Ⅳ. Practical Points (From the Employee’s Perspective)
Even as a fixed-term employee, if the company has accumulated a practice of repeated renewals or conversions to permanent status, a legitimate expectation of renewal may be recognized. In such cases, the employer’s refusal to renew can be challenged as tantamount to a dismissal. However, as in this case, where the performance evaluation result is significantly lower than that of colleagues and the evaluation and interview procedures have been conducted in a consistent manner, the Labor Relations Commission may broadly recognize the employer’s discretion. Therefore, it is necessary for employees to accumulate objective materials regarding their work performance and attitude (performance indicators, completion of training, records of objections to superiors’ evaluations, etc.) on an ongoing basis.
Ⅴ. Practical Points (From the Employer’s/Company’s Perspective)
Where fixed-term employees are repeatedly renewed or mostly converted to permanent status, there is a high likelihood that a legitimate expectation of renewal will be recognized. Employers should therefore clearly establish in advance, and operate consistently, the criteria and procedures for renewal (evaluation items, scoring standards, interview methods). In particular, as in this case, if the fact that the employee received the lowest rating through performance evaluations and interviews, and that the evaluation was conducted according to objective criteria, is documented and recorded, the likelihood that the Labor Relations Commission or the courts will recognize reasonable grounds for refusal to renew will be higher.
This type of decision illustrates how a fixed-term employee’s legitimate expectation of renewal and the employer’s discretion in evaluation are balanced in unfair dismissal disputes. Both employees and employers are advised to seek assistance from experts such as Labor Law Firm Law& to review in advance the design of performance evaluation systems and strategies for responding to disputes.
2. Matters Adjudicated
A. Case Overview and Procedural History
A. Whether a legitimate expectation of renewal existed
Since it was recognized that, for all fixed-term employees, the employer had in most cases either converted them to permanent status or renewed their contracts upon expiry, the employee was also deemed to have a legitimate expectation of renewal.
B. Whether there were reasonable grounds for refusal to renew
To determine whether to renew the employee’s contract, the employer conducted and evaluated performance assessments and interviews. The employee’s evaluation score corresponded to a “C” grade, the lowest among those evaluated, and, absent special circumstances, the employer’s performance evaluations are afforded considerable discretion. Therefore, reasonable grounds for the refusal to renew were recognized.
3. Summary of the Decision
A. Summary of the Labor Relations Commission’s Reasoning
A. Whether a legitimate expectation of renewal existed
Since it was recognized that, for all fixed-term employees, the employer had in most cases either converted them to permanent status or renewed their contracts upon expiry, the employee was also deemed to have a legitimate expectation of renewal.
B. Whether there were reasonable grounds for refusal to renew
To determine whether to renew the employee’s contract, the employer conducted and evaluated performance assessments and interviews. The employee’s evaluation score corresponded to a “C” grade, the lowest among those evaluated, and, absent special circumstances, the employer’s performance evaluations are afforded considerable discretion. Therefore, reasonable grounds for the refusal to renew were recognized. /
[Further Related Decisions]
- “Unfair Dismissal Decision on ‘Failure to Meet Requirements for Redundancy Dismissal (Workout Company)’”
- “Unfair Dismissal Decision on ‘No Formation of Hiring Commitment (Absence of Offer Letter)’” – Decision date: – Case result: First-instance decision upheld
- “Unfair Dismissal Decision on ‘Expression of Intention to Resign (Resignation Remark in Telephone Call)’”
[Tags]
Unfair dismissal, refusal to renew (C-grade performance evaluation), refusal to renew fixed-term contract, personnel evaluation · poor performance, Labor Law Firm Law&, large labor law firm, Samseong-dong labor law firm, Samseong Station labor law firm, Gangnam labor law firm
※ This article is part of the “Unfair Dismissal Decisions” series by Labor Law Firm Law&.
※ The previous article, “Unfair Dismissal Decision on ‘Excessive Disciplinary Measure (Concurrent Position at University)’,” can be viewed in a new window.
※ The list of decisions related to refusal to renew (C-grade performance evaluation) can be viewed together at “List of Decisions Related to Refusal to Renew (C-Grade Performance Evaluation).”
※ Korean version of this case: Korean article
